U.W. Marx, Inc. v. Bonded Concrete, Inc.

7 A.D.3d 856, 776 N.Y.S.2d 617, 2004 N.Y. App. Div. LEXIS 6527
CourtAppellate Division of the Supreme Court of the State of New York
DecidedMay 6, 2004
StatusPublished
Cited by16 cases

This text of 7 A.D.3d 856 (U.W. Marx, Inc. v. Bonded Concrete, Inc.) 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
U.W. Marx, Inc. v. Bonded Concrete, Inc., 7 A.D.3d 856, 776 N.Y.S.2d 617, 2004 N.Y. App. Div. LEXIS 6527 (N.Y. Ct. App. 2004).

Opinion

Carpinello, J.

Appeal from a judgment of the Supreme Court (Canfield, J.), entered November 13, 2002 in Rensselaer County, upon a verdict rendered in favor of plaintiff.

The instant dispute arises out of a contract to provide concrete for new sidewalks as part of a larger school renovation project. The contract was entered into by plaintiff, a general contractor, and defendant, a concrete supplier. Less than a year after their installation, the sidewalks developed pock marks. Upon being advised of the problem, defendant offered to remove the existing sidewalks and provide new concrete. When defendant refused to comply with plaintiffs additional demand to pay the costs associated with installing new sidewalks, litigation ensued.

Asserting theories of breach of contract and breach of various warranties, plaintiffs original complaint sought to recover all costs incurred in replacing the sidewalks, which totaled over $85,000. After filing a note of issue, however, plaintiff successfully moved to amend the complaint to add a claim for deceptive business practices under General Business Law § 349. Plaintiff alleged that defendant knew that its concrete was defective because its gravel pit had been removed from a Department of Transportation (hereinafter DOT) list of approved sources for DOT highway projects as of January 1995 because its coarse aggregate did not meet DOT testing standards (see Matter of Troy [857]*857Sand & Gravel Co. v New York State Dept. of Transp., 277 AD2d 782 [2000], lv denied 96 NY2d 708 [2001]; Matter of Troy Sand & Gravel Co. v New York State Dept, of Transp., 270 AD2d 698 [2000], lv denied 95 NY2d 755 [2000]).

The parties’ respective positions on the cause of the sidewalks’ deterioration are as follows. Plaintiff claims that the sidewalks deteriorated because of an unsatisfactory air void system and because the coarse aggregate in defendant’s concrete contained excessive amounts of unsound shale and, thus, the concrete could not withstand winter conditions. Plaintiff further denies that anything its employees did when installing the sidewalks caused or contributed to their deterioration. Defendant, on the other hand, steadfastly defends the quality of its product and claims that improper curing and installation techniques by plaintiffs employees caused the sidewalks to deteriorate.

Notably, both sides presented compelling evidence to support their respective positions at trial, but the jury ultimately found in plaintiffs favor on all causes of action. It awarded plaintiff $86,465.79 on the breach of contract and warranty causes of action and nearly $87,000 in counsel fees on the deceptive business claim. On this appeal, we are compelled to reverse for two reasons. First, Supreme Court improperly permitted plaintiff to amend the complaint to add a deceptive business cause of action. Moreover, prejudicial and irrelevant evidence concerning defendant’s dispute with DOT permeated the trial, thus undermining the verdict on the remaining causes of action. Accordingly, a new trial is required on the claims that survive.

We first address the General Business Law § 349 claim. General Business Law § 349 (h) gives private citizens a right of action for deceptive acts or practices in the conduct of any business, trade or commerce. Under the statute, citizens can enjoin an unlawful act or practice, recover the greater of actual damages or $50 and/or obtain reasonable counsel fees (see General Business Law § 349 [h]; see also Stutman v Chemical Bank, 95 NY2d 24, 28 [2000]). This statutory provision was specifically enacted to “increase the effectiveness of consumer protection laws which prohibit deceptive acts and practices in commerce” (Sponsor’s Mem, L 1980, ch 346, 1980 NY Legis Ann, at 146). Stated differently, it is a consumer-oriented statute which “enables consumers to protect themselves instead of being forced to rely on publicly-funded governmental agencies” (Sponsor’s Mem, L 1980, ch 346,1980 NY Legis Ann, at 146; see Governor’s Mem approving L 1980, ch 346, 1980 Legis Ann, at 147; see also Gaidon v Guardian Life Ins. Co. of Am., 94 NY2d 330, 343-344 [1999]).

[858]*858In keeping with the statute’s legislative history, courts have consistently held that in order to plead and prove a claim under this statute, a plaintiff must make a threshold showing that the challenged act or practice was consumer oriented, that is, it must have a broad impact on consumers at large (see e.g. Stutman v Chemical Bank, supra; Oswego Laborers’ Local 214 Pension Fund v Marine Midland Bank, 85 NY2d 20, 25-27 [1995]; Green Harbour Homeowners’ Assn. v G.H. Dev. & Constr., 307 AD2d 465, 468 [2003], lv dismissed 100 NY2d 640 [2003]; Teller v Bill Hayes, Ltd., 213 AD2d 141, 145 [1995], lv dismissed and denied 87 NY2d 937 [1996]). Plaintiff wholly failed to make such a showing in this case. Simply said, the contract at issue was a private, arm’s length business transaction between two sophisticated entities, each with substantial prior experience in commercial construction (see St. Patrick’s Home for Aged & Infirm v Laticrete Intl., 264 AD2d 652, 655 [1999]; see also Genesco Entertainment, Div. of Lymutt Indus. v Koch, 593 F Supp 743, 751-752 [1984]). The terms for this large-scale school renovation project were tailored to meet the school district’s unique specifications; defendant’s bid proposal was responsive thereto and the contract costs were hardly modest amounts of money. In sum, this was a complex private business transaction, not one based on a standard-form contract addressed to consumers generally (see New York Univ. v Continental Ins. Co., 87 NY2d 308, 320-321 [1995]; Green Harbour Homeowners’ Assn. v G.H. Dev. & Constr., supra; Parrino v Sperling, 232 AD2d 618, 619 [1996]; Teller v Bill Hayes, Ltd., supra; cf. Oswego Laborers’ Local 214 Pension Fund v Marine Midland Bank, supra).

Moreover, the dispute over whether defendant breached any aspect of this contract simply does not have broad, consumer-oriented ramifications (cf. Gaidon v Guardian Life Ins. Co. of Am., supra). No alleged act of defendant was “directed at the consuming public” (id. at 343 [emphasis added]; see Oswego Laborers’ Local 214 Pension Fund v Marine Midland Bank, supra; Revlon Consumer Prods. Corp. v Arnow, 238 AD2d 223, 224 [1997]), and although defendant’s alleged breaches many have had some tangential effect on members of the public (i.e., anyone using the sidewalks while on school property), factual allegations of broad, consumer-oriented deceptive conduct are simply lacking. Said differently, the fact that these sidewalks were being installed on public school property did not elevate this purely private construction dispute into one with broad, consumer protection implications (see generally Cruz v NYNEX Info. Resources, 263 AD2d 285, 290-291 [2000]). Supreme Court therefore erred in permitting the complaint to be amended and the jury’s award of counsel fees under this cause of action must be vacated.

[859]*859We turn now to Supreme Court’s decision to permit plaintiff to introduce evidence regarding defendant’s failure to meet DOT standards and specifications for aggregate used in state highway and bridge projects. It was error to permit this evidence, which was extensive in nature and highly prejudicial to defendant, because it is undisputed that the specifications for the sidewalks

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7 A.D.3d 856, 776 N.Y.S.2d 617, 2004 N.Y. App. Div. LEXIS 6527, Counsel Stack Legal Research, https://law.counselstack.com/opinion/uw-marx-inc-v-bonded-concrete-inc-nyappdiv-2004.