The defendant also served a memorandum of law in opposition to plaintiff's motion for summary judgment and in support of its cross-motion for summary judgment setting forth two points:
PLAINTIFF IS NOT ENTITLED TO SUMMARY JUDGMENT SINCE IT PERFORMED THE CONTRACT IN A NONCONFORMING MANNER
Plaintiff's motion for summary judgment should be denied. Although Allison did enter a sales agreement to purchase cassette shells from plaintiff, plaintiff's continual breaching of the purchase agreement by performing the sales order in a nonconforming matter caused Allison to incur substantial costs of approximately $110,000.00 which significantly diminishes and negates plaintiff's claim. When Allison agreed to purchase the cassette shells, plaintiff promised to ship the shells in plain packaging in seven shipments to be completed by November 27, 1995. However, plaintiff failed to meet these requirements. Instead, plaintiff sent a large number of the cassettes in the wrong packaging and continually made its deliveries late, even after it unilaterally revised the delivery dates. These breaches of the agreement caused Allison to incur substantial costs and damages as Allison had to repackage the cassettes and make extraordinary efforts to meet its customers' demands for the cassettes despite plaintiff's failure to delivery the cassettes in a timely manner. Accordingly, plaintiff's motion for summary judgment should be denied.
Summary judgment is a drastic remedy, the procedural equivalent of trial. Epstein v. Scully, 99 A.D.2nd 713 (1st Dept. 1989). To grant a motion for summary judgment, the court must determine that there exists no material and triable issue of fact. Suffolk County Department of Services v. James M., 83 N.Y.2d 178, 182, 608 N.Y.S.2d 940 (1994); Sillman v. Twentieth Century Fox Film Corp., 3 N.Y.2d 395, 404, 165 N.Y.S.2d 498 (1957), reh'g denied, 3 N.Y.2d 941 (1957). A motion for summary judgment involves a search of the record to determine the existence of material and triable issues of fact. The strength of either party's argument is not to be decided. Cross v. Cross, 112 A.D.2d 62, 64, 491 N.Y.S.2d 353 (1st Dept. 1985). If there is any doubt as to the existence of a genuine issue of fact, the summary judgment motion must be denied. Gale v. Kessler, 93 A.D.2d 744, 461 N.Y.S.2d 295 (1st Dept. 1983).
To this end, the court's function in a summary judgment proceeding is issue finding and not issue determination. Super v. Abdelazim, 108 A.D.2d 1040, 485 N.Y.S.2d 612 (3rd Dept. 1985); Sillman v. Twentieth Century Fox Film Corp., 3 N.Y.2d at 404. Thus, on a summary judgment issue, the court is not to determine credibility, but only determine whether there arguably exists a genuine issue of fact. Computer Strategies, Inc. v. Commodore Business Machines, Inc., 105 A.D.2d 167, 483 N.Y.S.2d 716 (2nd Dept. 1984); see also Glick & Dolleck, Inc. v. Tri-Pak Export Corp., 22 N.Y.2d 439, 293 N.Y.S.2d 93 (1968).
Moreover, summary judgment may not be granted on a seller's claim for goods sold and delivered when there are unresolved factual issues concerning whether the seller breached any of the terms of the underlying sale agreement. Created Gemstone, Inc. v. Union Carbide Corp., 47 N.Y.2d 250, 253, 417 N.Y.S.2d 905, 906 (1979). Although a buyer generally must pay for any goods accepted, such acceptance does not in and of itself impair any remedy the buyer may have against the seller for nonconforming performance, including the recovery of damages. See Flick Lumber Co., Inc. v. Breton Industries, Inc., 223 A.D.2d 779, 636 N.Y.S.2d 169 (3rd Dept. 1996); Sears, Roebuck & Co. v. Galloway, 195 A.D.2d 825, 827, 600 N.Y.S.2d 773, 775 (3rd Dept. 1993); 93 N.Y.Jur2d, Sales, §§142, 234.
Where the seller's performance is nonconforming, the buyer's right to be made whole can be exercised as a claim for damages, even if the claim is made in the buyer's pleadings by way of an answer or counterclaim. See 93 N.Y.Jur2d, Sales, §§ 142, 236. Indeed, "a buyer may defeat or diminish a seller's substantive action for goods sold and delivered by interposing a valid counterclaim for breach of the underlying sales agreement." Created Gemstones, Inc. v. Union Carbide Corp., 47 N.Y.2d 250, 255, 417 N.Y.S. 2d 905, 907 (1979). Thus, where the buyer raises questions regarding the seller's performance according to his obligations under the contract, a seller may not recover the full purchase price. See Karen v. Cane, 152 Misc.2d 639, 578 N.Y.S.2d 85 (Civ. Ct. Queens Co. 1991). Accordingly, summary judgment should not be granted.
For example, in Flick Lumber Co., Inc. v. Breton Industries, Inc., 223 A.D.2d 779, 636 N.Y.S.2d 169 (3rd Dept. 1996), the court denied the seller's motion for summary judgment for the price of goods sold and delivered. The buyer had agreed to purchase and pay the seller for wood boards cut to government specifications which the buyer needed to complete a government contract. Although the seller delivered the goods it did not receive full payment. When the seller commenced the action to recover the full price, the buyer counterclaimed stating that it had incurred substantial costs because the wood which the seller had delivered did not meet the specifications. The buyer had to sort through the delivered boards and re-cut them to match the government specifications. The court held that since the buyer had interposed a valid counterclaim, which could significantly diminish or negate the seller's action for the price of the accepted goods, the court could not grant the seller's motion for summary judgment. See also B. Milligan Contracting Inc. v. Andrew R. Mancini Associates Inc., 174 A.D.2d 136, 578 N.Y.S.2d 931 (3rd Dept. 1992)(in action by seller to recover the price of goods delivered and accepted, buyer's counterclaim alleging, inter alia, delivery of nonconforming wall panels raised questions of fact which precluded summary judgment).
Here, as demonstrated in the accompanying affidavit of Allison's President, Randy M. Ligator, plaintiff failed to comply with the delivery requirements of the sales agreement. Under the original agreement, plaintiff was obligated to deliver the cassette shells in plain packaging to Allison's warehouse in Harrison, New Jersey, by means of seven shipments which were to arrive on November 10, 13, 15, 17, 20, 22 and 27. However, plaintiff did not meet any of the delivery requirements. For example, less than twenty-four hours before the first shipment was to be delivered, plaintiff informed Allison that it would not deliver the first shipment to Allison's warehouse, but that Allison had to arrange to pick up the cassette shells from a warehouse in Indiana. This cost Allison approximately $2,500.00.
Plaintiff also failed to ship the second and third deliveries in plain packaging as originally agreed. Since Allison was purchasing these cassettes for immediate resale the original purchase order called for plaintiff to ship the cassettes in brick-pak or white boxes, not Auriga packaging. However, the plaintiff delivered the second and third shipments in Auriga packaging, causing Allison to open and repackage the cassettes. This cost Allison approximately $8,000.00.
Plaintiff also breached the terms of the purchase agreement by delivered the next four shipments late. Despite Allison's protests, plaintiff unilaterally revised its delivery dates, changing the last scheduled delivery date from November 27 to December 8, 1995. However, plaintiff could not even meet its own unilaterally revised delivery dates. Allison did not receive the fourth shipment until December 8, 1995, approximately 21 days after the originally agreed upon delivery date of November 17, 1995, and approximately 11 days after plaintiff's unilaterally revised delivery date of November 27, 1995. The fifth shipment was not was not received until December 4, 1995, approximately 14 days after the originally agreed upon delivery date of November 20, 1995, and approximately 4 days after plaintiff's unilaterally revised delivery date of November 30, 1995. The sixth shipment was not received until December 7, 1994, approximately 15 days after the originally agreed upon delivery date of November 22, 1995, and approximately 3 days after plaintiff's unilaterally revised delivery date December 4, 1995. Finally, the seventh shipment was not received until December 11, 1995, approximately 14 days after the originally agreed upon delivery date of November 27, 1995, and approximately 3 days after the plaintiff's unilaterally revised delivery date of December 8, 1995.
As a result of these late shipments, Allison incurred substantial costs as it attempted to mitigate the damages it would sustain as a result of plaintiff's breach. Plaintiff's delayed deliveries caused Allison to breach some of its contracts with its customers and to nearly breach a large number of its other contracts. In order to decrease the number of lost customers, Allison employed various methods to satisfy its customers-despite plaintiff's breach-such as offering many of its customers discounts to accept smaller to delayed shipments.
Allison also scrambled to obtain cassettes from other sources to make up for the shortfall caused by plaintiff's delayed shipments. For example, Allison contacted its customers which had previously received large shipments of Allison cassettes and repurchased a large number of cassettes from their inventories so that Allison could then have them delivered to the customers who were supposed to receive the cassettes Allison was purchasing from plaintiff. Allison also paid increased shipping and handling costs in order to decrease the amount of turn around time between the time Allison received plaintiff's delayed deliveries and when the cassettes were shipped to Allison' customers. These efforts to mitigate the effect of plaintiff's delayed performance caused Allison to incur increased costs of approximately $20,000.00.
Moreover, despite these efforts many customers simply canceled their orders with Allison when Allison could not fulfill their orders in a timely manner as a result of plaintiff's delayed performance. Allison lost approximately $250,000.00 to $500,000.00 in sales orders and profits of approximately $40,000.00 to $80,000.00.
Additionally, Allison continuing attempts to obtain redress from the plaintiff were utterly unsuccessful. Allison's President Randy M. Ligator called plaintiff's sales representative numerous times to complaint about the poor treatment Allison was receiving and about the increased costs Allison was incurring as a result of plaintiff's mis-packaging and delayed deliveries. However, many of these calls were simply not accepted or returned. And, the few times Ligator was able to speak to plaintiff's representatives, they would simply state that there was nothing more that plaintiff could or would do and that Allison should take whatever action it felt was necessary.
Finally, this court should also deny plaintiff's motion for summary judgment because there has yet to be any discovery in this case due to plaintiff's repeated requests to adjourn its deposition scheduled by defendant. See Bingham v. Wells, Rich, Green Inc., 34 A.D.2d 924, 311 N.Y.S.2d 508 (1st Dept. 1970)(generally motion for summary judgment should not be granted prior to completion of discovery where facts necessary to oppose motion may exist and are within the exclusive control of the moving party). Defendant served a notice of deposition upon plaintiff requesting to examine plaintiff by the person most knowledgeable of plaintiff's dealings and communications with Allison. The deposition was originally scheduled for September 23, 1997. However, plaintiff has repeatedly requested that the deposition be adjourned so that it could prepare the documentation that would be necessary to defend itself at a deposition. Plaintiff requested that the deposition be adjourned from September 23, 1997, to November 13, 1997, to January 13, 1998, to February 9, 1998.
Since Allison has incurred substantial costs as a result of plaintiff's non-conforming performance in delivering the cassettes, it has a meritorious counterclaim which would significantly diminish or negate plaintiff's claim. Accordingly, an award of summary judgment in favor of plaintiff is not warranted.
DEFENDANT SHOULD BE PERMITTED TO AMEND ITS ANSWER
C.P.L.R. 3025(b) provides that a party may amend his pleading at any time by leave of the court or by stipulation of the parties. The rule clearly states that "leave shall be freely given." See C.P.L.R. R. 3025(b). Accordingly, the courts have construed the rule liberally and have freely granted parties leave to file amended pleadings absent surprise or prejudice to the other party. See Rahn v. Carkner, ___A.D.2d____, 659 N.Y.S.2d 143 (3rd Dept. 1997); Albany Crane Services Inc. v. Pettibone Mulliken Corp., 54 A.D.2d 794, 387 N.Y.S.2d 740 (3rd Dept. 1976); Leutloff v. Leutloff, 47 Misc.2d 458, 262 N.Y.S.2d 736 (Sup. Ct. Onondaga Co. 1965).
Defendant's motion to amend its answer and present a counterclaim should be granted on the ground that defendant's amended counterclaim is closely related to plaintiff's claim that it would be counter productive of judicial economy to require defendant to commence a separate action. See Pignataro v. Balsamo, 108 A.D.2d 1086, 485 N.Y.S.2d 656 (3rd Dept. 1985). The counterclaim alleges that plaintiff mis-packaged the goods its shipped and delivered the goods in an untimely fashion causing defendant to incur substantial damages. If established the counterclaim would significantly diminish or negate plaintiff's claim.
Additionally, such an amendment would neither prejudice nor surprise the plaintiff because no discovery has been conducted in this case and the grounds for defendant's counterclaim were known to plaintiff since the documentation it provided in support of its summary judgment motion show that plaintiff failed to deliver the cassette shells in the manner agreed upon by the parties. In its moving papers, plaintiff submits as exhibits the Allison purchase order showing the originally agreed upon delivery dates and that the destination for each delivery would be Harrison, New Jersey, the Auriga Plasticos order form stating that the customer would take the product in brick-pak or white boxes, the fax purportedly revising the delivery schedule, and the invoices for each shipment showing that each delivery was late, meeting neither the agreed upon delivery date nor plaintiff's unilaterally revised delivery date.
Plaintiff then served an affirmation in opposition to the cross-motion by its attorney. This affirmation simply stated that the counterclaim in the defendant's proposed amended answer failed to state a cause of action, as more fully described in the plaintiff's reply memorandum of law. The plaintiff's reply memorandum of law stated briefly the facts concerning the defendant's answer and proposed counterclaim:
When the defendant served its answer to the complaint in this action, it denied that it ordered and accepted the goods that the plaintiff sold to it and the unpaid balance of $167,000.00. The defendant did not raise any affirmative defenses or counterclaims when it served it answer on or about July 28, 1997. When the defendant served its affidavit opposing this motion for summary judgment eight (8) months later, the defendant admitted that it ordered and accepted the goods that remain unpaid in the sum of $167,360.00. Now defendant says that it wants to assert a counterclaim for damages for late delivery and wrong packaging estimated to be $110,000.00.
The reply memorandum of law in support of plaintiff's motion for summary judgment and in opposition to defendant's cross-motion argued that:
THE DEFENDANT'S OPPOSING AFFIDAVIT DOES NOT RAISE TRIABLE ISSUES OF FACT
We agree that issue finding, rather than issue determination, is the key to summary judgment, Sillman v. Twentieth Century-Fox Film Corp., 3 N.Y.2d 395, 404, 165 N.Y.S.2d 498, 505 (1957). The issues sought to be raised by the defendant must be genuine, not feigned, Curry v. Mackenzie, 239 N.Y. 267, 270, 146 N.E. 375, 376 (1925). Evidentiary facts must be presented by the defendant to show that there is support, in fact, for the issues its seeks to raise, Kruger Pulp & Paper Sales, Inc. v. Intact Containers, Inc., 100 A.D.2d 894, 895, 474 N.Y.S.2d 554, 555 (1984).
The defendant now admits that it ordered the cassette shells. It no longer denies that it accepted and received $167,000 worth of unpaid cassette shells by December 11, 1995. It does not deny that the purchase order consisted of plaintiff's fax of November 6, 1995, defendant's purchase order of November 8, 1995, and plaintiff's fax of November 8, 1995, (Exhibit "1") [FN(a)]. These uncontroverted facts are deemed admitted, Kuehne & Nagel, Inc. v. F.W. Baiden, 36 N.Y.2d 539, 544, 369 N.Y.S.2d 667, 671 (1975).
FN(a) All numbered exhibit references are to the moving papers.
The defendant tries to raise issues of late delivery and wrong packaging. The plaintiff, it says, unilaterally changed the delivery dates in plaintiff's November 10, 1995, fax (Exhibit "2") and changed the packaging for the cassette shells.
Defendant's asserts that the agreement of purchase required brick pack or plain packaging. The defendant's purchase order does not mention packaging. Only the plaintiff's November 8, 1995, fax says the packaging will be brick-pack or white boxes and notes defendant's preference for brick-pack.
Plaintiff's November 10, 1995, fax to defendant sets forth the delivery dates and the packaging for each shipment. The packaging for the first shipment is not indicated. The packaging for the second and third shipments (November 20 and 21) is indicated as Auriga packing. The packaging for the fourth shipment (November 27) is indicated as = brick pack and = white box packaging. The packaging for the fifth, sixth and seventh shipments (November 30, December 4 and December 8) is indicated as White box packaging.
The packaging for the first three shipments appears to differ from the brick pack or white box packaging that the plaintiff indicated it would supply in its November 8, 1995, fax. The packaging for the fourth shipment matches the packaging that the plaintiff indicated it would supply in its November 8, 1995, fax, and that defendant says was agreed upon.
Even if the first three shipments were not correctly packaged and even if the second, third and fourth shipment were delivered later than originally agreed upon, the defendant's much delayed payments to the plaintiff in full for the first three shipments and partial payments for the fourth shipment means that the defendant accepted the shipments in full satisfaction of plaintiff's obligation, see Belmet Prods. v. Merit Enters., 37 Misc. 2d 368, 371, 236 N.Y.S.2d 254, 258 (N.Y. Civ. Ct. 1963). Once the goods were accepted by the defendant, it was required to pay for them at the contract price, Maggio Importato, Inc. v. Cimitron, Inc., 189 A.D.2d 654, 655, 592 N.Y.S.2d 325, 326, lv. denied, 82 N.Y.2d 652, 601 N.Y.S.2d 582 (1993).
The defendant paid for the first four shipments, as follows:
- Exhibit "3"-11/10/95 pick up Paid $51,840.00 2/8/96
- Exhibit "4"-11/13/95 ship 11/13/95 receipt Paid $51,840.00 1/25/96
- Exhibit "5"-11/16/95 ship 11/20/95 receipt Paid $51,840.00 3/13/96
- Exhibit "6"-11/22/95 ship 12/8/95 receipt Paid $20,000.00 6/7/96 Paid $20,000.00 7/3/96.
While the terms of defendant's own purchase order called for payment thirty (30) days after receipt, the defendant made its payment for the first shipment on 1/25/96, almost 90 days after receipt. The defendant made its payments for the second and third shipments from more than between sixty to ninety days after receipt and partial payment of $40,000 on the fourth shipment more than six and seven months after receipt.
Defendant's full payment for the first three shipments so long after receipt and the partial payment for the fourth shipment many months later leads to one inescapable conclusion: that the defendant's current claim of damages has been created solely to defeat plaintiff summary judgment motion and delay payment to plaintiff for the $167,360.00 of cassette shells that the defendant accepted.
Other than this defendant's claimed oral objections, nothing was done by the defendant to notify plaintiff of a claimed breach until service of the defendant's opposing affidavit eight months after the joinder of issue and more than two years after the final receipt of the cassette shells on December 5, 1995. Unlike International Paper Co. v. Margrove, Inc., 75 Misc. 2d 763, 765-66, 348 N.Y.S.2d 916, 919-20 (N.Y. Sup. Ct. 1973), there is no evidence presented on this summary judgment motion to support defendant's claim of oral complaints. This defendant's unreasonably long delay of over two years before it gave the plaintiff proper notice is insufficient to raise triable issues of fact, see Mount Vernon Mills v. Murphy Textile Mills , 148 A.D.2d 389, 390, 539 N.Y.S.2d 334, 335 (1989). Pursuant to Uniform Commercial Code, § 2-607 the defendant-buyer must pay for the $167,360.00 of cassette shells that it accepted and the defendant is barred from any remedy, since it failed to notify the plaintiff-seller within a reasonable time of the claimed breach.
The relevant portions of the cited section of the UCC read:
- The buyer must pay at the contract rate for any goods accepted.
- Where a tender has been accepted
- the buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy; and
- The burden is on the buyer to establish any breach with respect to the goods accepted.
The counterclaim in the defendant's proposed, amended answer does not even contain an allegation that notice of the claimed breach was given to the plaintiff. The proposed counterclaim fails to state a cause of action and amendment of defendant's answer must be denied.
Other than the defendant's numerous, conclusory assertions of damages caused by late deliveries and by wrong packaging, not one iota of proof is presented to support the defendant's alleged damages of $110,000.00. In the absence of proof of such damages, the claimed delays and wrong packaging do not serve as a bar to plaintiff's recovery of the unpaid balance of $167,360.00, see Belmet Prods. v. Merit Enters., 37 Misc. 2d 368, 371, 236 N.Y.S.2d 254, 258 (N.Y. Civ. Ct. 1963). Defendant's claim for damages, if any, is separate and apart from its indebtedness for the purchase price of $167,300.00, see Paul Conte Cadillac v. C.A.R.S. Purchasing Serv., Inc ., 126 A.D.2d 621, 623, 511 N.Y.S.2d 58, 60 (1987).
In its memorandum of law, defendant cites Created Gemstones, Inc. v. Union Carbide Corp., 47 N.Y.2d 250, 255, 417 N.Y.S.2d 905, 907 (1979), and B. Milligan Contracting Inc. v. Andrew R. Mancini Assoc. Inc., 174 A.D.2d 136, 578 N.Y.S.2d 931 (1992), and Flick Lumber Co. v. Breton Indus., Inc., 223 A.D.2d 779, 636 N.Y.S.2d 169 (1996), for the proposition that a buyer may defeat or diminish a seller's substantive action for goods sold and delivered by interposing a valid counterclaim for breach of the underlying sales agreement. The key word in these cases is "valid." In the instant case, the defendant's counterclaim is not valid.
In Flick Lumber Co. v. Breton Indus., Inc., 223 A.D.2d at 780, 636 N.Y.S.2d at 170, the Court found a triable issue of fact when:
"[the opposing affidavit of defendant's chief executive officer]...was based upon alleged personal knowledge of the facts and circumstances and made numerous, detailed factual allegations pertaining to the counterclaim. In addition, the claims set forth in his affidavit are supported by documentary evidence which was attached to the affidavit; for example, a letter from one of plaintiff's employees acknowledging the problems Breton was experiencing with the boards***[and further found that the] affidavit sets forth a reasonably specific recitation of the claimed defects in the boards and the remedial measures Breton was required to undertake...." [Asterisks and bracketed material supplied.]
At first blush, the defendant's opposing affidavit paints a picture of a plaintiff-seller who made late deliveries in the wrong packaging and caused the defendant-buyer substantial damages. Closer scrutiny of the plaintiff's documentary evidence and the assertions of the defendant reveal that the defendant's version consists of nothing more than gross assertions of damages wholly lacking in any evidentiary support, See Kramer v. Harris, 9 A.D.2d 282, 283, 193 N.Y.S.2d 548, 550 (1959). The defendant's bald conclusory assertions of damages, even if believable, are not enough, to defeat the summary judgment motion especially where, as here, they are inconsistent with the pattern of events, id., and especially where, as here, this defendant does not claim that the facts are not within its control, S. J. Capelin Assoc., Inc. v. Globe Mfg. Corp., 34 N.Y.2d 338, 342, 357 N.Y.S.2d 478, 481 (1974)."
The defendant served a reply memorandum of law in support of its cross-motion to amend its answer and in further opposition to plaintiff's motion for summary judgment. The defendant's argument was that:
In its reply memorandum of law, plaintiff's principal argument, both in support of its motion for summary judgment and in opposition to defendant's cross-motion to amend its answer, is that defendant's oral objections were insufficient to constitute a valid notice of the claimed breaches of the sales contract to the plaintiff. However, both the Uniform Commercial Code and New York State case law permit oral objections to constitute a valid notice of breach.
Although U.C.C. § 2-607 requires a party who accepts tender of goods regarding which he claims defects to notify the seller of the breach, there is no requirement that the notice be in writing. See Computer Strategies, Inc. v. Commodore Business Machines, Inc., 105 A.D.2d 167, 483 N.Y.S.2d 716 (2d Dep't 1984); International Paper Co. v. Margrove, Inc., 75 Misc.2d 763, 348 N.Y.S.2d 916, 919 (Sup. Ct. Monroe Co. 1973) UCC § 1-201(26) provides that a "person 'notifies' or 'gives' notice or notification to another by taking such steps as may be reasonably required to inform the other in ordinary course whether or not such other actually comes to know of it." Moreover, "the notification need only alert the seller that the transaction is troublesome and does not need to include a claim for damages or threat of future litigation." Computer Strategies v. Commodore Business Machines, 105 A.D.2d 167, 483 N.Y.S.2d 716, 723 (2d Dep't 1984).
Here, as demonstrated in the original affidavit of Allison's President, Randy M. Ligator, defendant continually made its protestations about plaintiff's breaches of the sales contract known to plaintiff and its agents. For example, when plaintiff, with less than twenty-four hours notice, informed defendant that it would not deliver the first shipment to defendant's New Jersey warehouse, Ligator protested that the missed shipment would cause defendant to lose substantial sales and damage its relationships with its customers. Ligator also states in his affidavit that he continually attempted to obtain redress from the plaintiff. He called plaintiff's representative numerous times to complain about the poor treatment Allison was receiving and the increased costs Allison was sustaining as a result of plaintiff's unilateral revisions of the purchase order, the mis-packaging of the shipments, and the delayed deliveries.
Accordingly, plaintiff's reliance on Mount Vernon Mills, Inc. v. Murphy Textile Mills, 148 A.D.2d 389, 539 N.Y.S.2d 334 (1st Dep't 1989) is misplaced. In Mount Vernon the buyer did not raise any complaints prior to the commencement of the suit while in this case defendant voiced numerous oral complaints prior to the commencement of the suit.
Plaintiff's reliance on Kruger Pulp & Paper Sales,Inc. v. Intact Containers, Inc., 100 A.D.2d 894,895, 474 N.Y.S.2d 554 (1984) is also misplaced. In Kruger, the seller submitted affidavits that established that the seller had never voiced any complaints about the merchandise and even admitted to the seller that his only reason for not paying was credit problems. Here, plaintiff does not deny or controvert any of Ligator's sworn allegations about the mis-packed shipments, the late deliveries or Ligator's oral protestations to the plaintiff. Indeed, plaintiff does not even bother to submit an affidavit from any person with actual knowledge of the facts. Instead, plaintiff merely submitted a one-page attorney's affidavit from one without person knowledge of the facts. See Matter of O'Hara, 85 A.D.2d 657, 445 N.Y.S.2d 201, 204 (2d Dep't 1981)("An affirmation by an attorney, without personal knowledge, will not suffice and should be entirely disregarded.").
Paul Conte Cadillac, Inc. v. C.A.R.S. Purchasing Serv., Inc., is also distinguishable. In Conte, the court held that the defendant's claim for damages was separate and apart from its indebtedness for the purchase price where defendant was attempting to assert its counterclaim as a reason for vacating a default judgment. Here, defendant has not defaulted. In fact, defendant is asserting its counterclaim prior to any discovery being conducted.
Finally, where the seller's performance is nonconforming, the buyer's right to be made whole can be exercised as a claim for damages, even if the claim is made in the buyer's pleadings by way of an answer or counterclaim. See 93 N.Y.Jur2d, Sales, §§ 142, 236. "[A] buyer may defeat or diminish a seller's substantive action for goods sold and delivered by interposing a valid counterclaim for breach of the underlying sales agreement." Created Gemstones, Inc. v. Union Carbide Corp., 47 N.Y.2d 250, 255, 417 N.Y.S.2d 905, 907 (1979). Thus, where the buyer raises questions regarding the seller's performance according to his obligations under the contract, a seller may not recover the full purchase price, see Karen v. Cane, 152 Misc.2d 639, 578 N.Y.S.2d 85 (Civ. Ct. Queens Co. 1991); and summary judgment should not be granted. See B. Milligan Contracting Inc. v. Andrew R. Mancini Associates Inc., 174 A.D.2d 136, 578 N.Y.S.2d 931 (3d Dep't 1992)(in action by seller to recover the price of goods delivered and accepted, buyer's counterclaim alleging, inter alia, delivery of nonconforming wall panels raised questions of fact which precluded summary judgment); see also Flick Lumber Co., Inc. v. Breton Industries, Inc., 223 A.D.2d 779, 636 N.Y.S.2d 169 (3d Dep't 1996).
On April 11, 1998, the motion and cross-motion were finally submitted to Justice James A. Gowan.