Consolidated Edison Co. v. Jet Asphalt Corp.

132 A.D.2d 296, 522 N.Y.S.2d 124, 1987 N.Y. App. Div. LEXIS 51561
CourtAppellate Division of the Supreme Court of the State of New York
DecidedDecember 10, 1987
StatusPublished
Cited by17 cases

This text of 132 A.D.2d 296 (Consolidated Edison Co. v. Jet Asphalt Corp.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Consolidated Edison Co. v. Jet Asphalt Corp., 132 A.D.2d 296, 522 N.Y.S.2d 124, 1987 N.Y. App. Div. LEXIS 51561 (N.Y. Ct. App. 1987).

Opinion

OPINION OF THE COURT

Carro, J.

Defendant-appellant, Jet Asphalt Corporation, was engaged in the manufacture of asphalt at a facility in Flushing, New York, until 1984. Desirous of cutting fuel costs, defendant’s president wrote to plaintiff Consolidated Edison in November 1979, inquiring about conversion to natural gas and requesting an operating cost estimate. Plaintiff failed to respond with a cost estimate, but assured defendant that conversion to natural gas would result in appreciable monetary savings. In early 1982, defendant converted from wholly oil consumption to a combination of oil and natural gas consumption, and became a customer of plaintiff for natural gas until June 1984, at which point it paid its final bill. Defendant then sold its business to a successor company.

To make the necessary readings for billing purposes, plaintiff had installed an eight-digit gas meter. Since plaintiff’s billing system was designed to accept readings of only six digits, the installer masked the first two digits with tape. Upon receiving the first month’s gas bill for $42,000, defendant, who had anticipated greater savings requested a verified reading. A "corrected bill” was rendered, charging defendant much less. Upon reviewing the matter, plaintiff’s representative also concluded that the meter had been improperly masked and proceeded to mask the first and last digits instead. It was not until 1985 that plaintiff discovered that the original masking was correct and that the erroneous masking had resulted in an underbilling of defendant by 90%.

By this time, defendant had sold its assets and had gone out of business. On October 18, 1985, plaintiff commenced the within action to recover the fuel charges. By notice of motion [299]*299dated February 6, 1986, plaintiff moved for summary judgment and dismissal of defendant’s defenses and its counterclaim in which defendant argued that plaintiff should be estopped from recovering the underbilling. In its written decision, the court rejected defendant’s argument of estoppel, concluded that there were no factual issues to be resolved and awarded plaintiff summary judgment in the amount under-billed, $870,920.47, plus interest calculated from June 29, 1984. The court further stated that defendant could not rely on an internal rule of plaintiff limiting recovery on an under-billing to a one-year period, since that rule did not operate when the customer "knew or reasonably should have known of the problem.” On this issue, the court concluded that since "[t]he billings for fuel from March 30, 1982 to June 29, 1984 were Vio of what defendants [sic] was previously paying,” defendant therefore "knew what was going on.” The court also rejected defendant’s claim of an accord and satisfaction.

Defendant moved for reargument and renewal and to amend its counterclaim to assert a constitutional argument. Defendant, inter alia, argued that the court had misconstrued the facts in finding that defendant was billed for one tenth of what it had previously been paying, since defendant had not used gas previously, and in finding incredible defendant’s claim that it had no reason to suspect it was being under-billed. Defendant also argued that the judgment entered awarding summary judgment ignored defendant’s counterclaim for damages. An order was subsequently entered purporting to deny reargument outright. However, in response to defendant’s point that the judgment had not specifically addressed the counterclaim, the court in its order specifically dismissed the counterclaim. In so doing, the court actually granted reargument to that extent and otherwise adhered to its prior judgment and decision. Accordingly, the appeal of the reargument motion is properly before this court, and we hold that the trial court erred in adhering to its grant of plaintiff’s motion for summary judgment.

A motion for summary judgment may only be granted when there exist no material and triable issues of fact. On such a motion the court’s role is limited to one of issue-finding, not issue-determining. (Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395, 404; Pantote Big Alpha Foods v Schefman, 121 AD2d 295, 296-297.) Accordingly, it is improper to resolve questions of credibility on a summary judgment motion, unless it clearly appears that the issues are "not genuine, but [300]*300feigned.” (Glick & Dolleck v Tri-Pac Export Corp., 22 NY2d 439, 441.) Moreover, on such a motion the opponent is entitled to all favorable inferences. (Cruz v American Export Lines, 67 NY2d 1, 13, cert denied sub nom. Bussanich v United States Lines, 476 US 1170; Pantote Big Alpha Foods v Schefman, supra, 121 AD2d, at 297.)

The affidavits submitted by defendant in opposition to the motion for summary judgment and on its reargument motion clearly present triable issues of fact as to whether and when defendant knew or reasonably should have known of the underbilling, a factor which determines defendant’s liability to pay the underbilling beyond the one-year limitation period provided by plaintiffs internal rules. Defendant points out that it had no experience with gas fuel and never did receive a response by plaintiff on its request for an estimate of how much it was likely to save on converting to gas. Plaintiff merely assured defendant that there would be appreciable savings. Further complicating the issue of whether defendant should have known it was being underbilled on its gas usage was the fact that defendant was using both oil and gas fuel. Furthermore, as time passed and defendant’s business began to wind down, there was a decreased use of fuel, thus supporting defendant’s expectation of a lower fuel bill.

Not only did the court improperly dismiss these factors as inconsequential, it concluded that defendant knew it was being underbilled on the erroneous assumption that defendant’s fuel bill was one tenth of what it had been. There is no evidence that defendant’s energy costs were one tenth of what they had been. The one-tenth factor only came into play after the conversion to gas, when defendant was being billed for only one tenth of what it was actually consuming. At that time, defendant had no basis for comparing its current fuel bills, which were based on mixed gas and oil usage, to its prior billings for the exclusive use of oil fuel.

Several factors also undermine the argument that even if defendant had no basis for comparison of the fuel bills, it nevertheless must have known it was being underbilled because of the low bills. When defendant’s president received the first gas bill, he expressed surprise at its amount, having expected greater savings, and requested a second meter reading. After reviewing the matter, plaintiff concluded that the first bill was too high and adjusted it to what ended up being an erroneous gas reading of one tenth of the actual amount used. Defendant makes an arguable claim that he was entitled [301]*301to rely on the new reading. Further, defendant’s passing on to its customers of its savings in fuel bills through its pricing of asphalt and its failure to create a contingency fund prior to the sale of the business support its argument that it had no knowledge of the inaccuracy of the gas bills. Given defendant’s arguments on the issue of whether it knew of the underbilling and the issue’s materiality to plaintiff’s right to seek recovery beyond the one-year period, the court erred in granting plaintiff’s motion for summary judgment.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

In re the Estate of Halpern
76 A.D.2d 429 (Appellate Division of the Supreme Court of New York, 2010)
Rose Inn of Ithaca, Inc. v. Great American Insurance
75 A.D.3d 737 (Appellate Division of the Supreme Court of New York, 2010)
Mounsey v. Mounsey
40 A.D.3d 1293 (Appellate Division of the Supreme Court of New York, 2007)
Nordbo v. Lutheran Medical Center
184 Misc. 2d 423 (Appellate Terms of the Supreme Court of New York, 2000)
Stapleton v. Mattera
266 A.D.2d 531 (Appellate Division of the Supreme Court of New York, 1999)
Courtney-Clarke v. Rizzoli International Publications, Inc.
251 A.D.2d 13 (Appellate Division of the Supreme Court of New York, 1998)
Gurfein Bros. v. Hanover Insurance
248 A.D.2d 227 (Appellate Division of the Supreme Court of New York, 1998)
International Rescue Committee v. Reliance Insurance
230 A.D.2d 641 (Appellate Division of the Supreme Court of New York, 1996)
General Motors Acceptance Corp. v. Desbiens
213 A.D.2d 886 (Appellate Division of the Supreme Court of New York, 1995)
Rochester Gas & Electric Corp. v. Greece Park Realty Corp.
195 A.D.2d 956 (Appellate Division of the Supreme Court of New York, 1993)
Hartford Insurance v. General Accident Group Insurance
177 A.D.2d 1046 (Appellate Division of the Supreme Court of New York, 1991)
American Realty Co. v. 64 B Venture
176 A.D.2d 226 (Appellate Division of the Supreme Court of New York, 1991)
Sabbagh v. Pantano
170 A.D.2d 411 (Appellate Division of the Supreme Court of New York, 1991)
Marine Midland Bank, N.A. v. Scallen
161 A.D.2d 103 (Appellate Division of the Supreme Court of New York, 1990)
Housing Authority v. Northeast Lake Washington Sewer & Water District
784 P.2d 1284 (Court of Appeals of Washington, 1990)
Jacksonville Electric Authority v. Draper's Egg & Poultry Co.
531 So. 2d 373 (District Court of Appeal of Florida, 1988)

Cite This Page — Counsel Stack

Bluebook (online)
132 A.D.2d 296, 522 N.Y.S.2d 124, 1987 N.Y. App. Div. LEXIS 51561, Counsel Stack Legal Research, https://law.counselstack.com/opinion/consolidated-edison-co-v-jet-asphalt-corp-nyappdiv-1987.