| Foot Locker, Inc. v Omni Funding Corp. of Am. |
| 2010 NY Slip Op 08431 [78 AD3d 513] |
| November 18, 2010 |
| Appellate Division, First Department |
| Foot Locker, Inc., Appellant, v Omni Funding Corp. ofAmerica, Respondent. |
—[*1] Maidenbaum & Associates, PLLC, Merrick (Carol G. Morokoff of counsel), forrespondent.
Order, Supreme Court, New York County (Milton A. Tingling, J.), entered November 4, 2009,which, upon granting plaintiff's motion to reargue an earlier order, adhered to its prior determinationdenying plaintiff summary judgment, unanimously affirmed, with costs. Appeal from the prior order(same court and Justice), entered June 24, 2009, unanimously dismissed, without costs, as supersededby the appeal from the later order.
Defendant leased photocopiers to plaintiff for a period of 48 months pursuant to an equipmentlease that would automatically renew for an additional 12 months if plaintiff failed to provide timelynotice of cancellation and return the equipment at the end of the lease term to a place designated bydefendant. The other relevant provisions of the lease, including its notice provision, provide as follows:
"CONDITION; USE; LOCATION; RETURN . . . Unless otherwise agreed inwriting, on termination or expiration of the Term, Lessee will immediately return the Equipment toLessor in as good condition as received, less normal wear and tear, to any place in the United StatesLessor designates. Lessee will prepay expenses of crating and shipping by means Lessor designatesand will insure the Equipment being shipped for its full replacement value. . . .
"TITLE; RECORDING; NOTICES Lessor shall hold title to the Equipment. Lessee will keep theEquipment free and clear from any levy, attachment . . . Unless otherwise provided, theparties agree that this transaction shall be a true lease . . . The equipment is and willremain personal property no matter what its use or attachment to realty, but Lessee will not let it beattached to realty in any way that might cause it to become part of such realty. [*2]Lessee shall pay Lessor's fees for lease documentation and processingand for any governmental filings. All notices shall be given in writing and shall be effective whendeposited in the U.S. mail, addressed to a party at its address shown on the front page of this Lease orat any other address such party specifies in writing, with first class postage prepaid."
Although the just quoted general notice provision appears to apply to all notices required by thelease, the lease specifically requires written notice in certain circumstances (e.g., paragraph 11,requiring written notice of breach of the clear title provision, and paragraph 14, requiring the lessee toadvise the lessor in writing of any loss within 10 days). In other circumstances, however, there is nosuch specific requirement (e.g., paragraph 12, providing that in the event of a breach, the lessee mustcure the breach within 10 days after notice but not specifying that the notice must be in writing). Theprovision requiring the lessee to prepay expenses of "crating and shipping by means lessor designates"does not specifically require written notification, nor does it say that a "designation" is a notice. Thisappeal turns on how this provision should be interpreted.
Plaintiff timely provided written notice of cancellation but failed timely to return the equipment todefendant. Plaintiff ascribes that omission to defendant's refusal to provide written instructions on howproperly to crate and ship the equipment, despite several requests for such instructions. Defendantinsists that it complied with the lease by providing an oral instruction to use a private trucking companyand that when plaintiff failed to return the copiers in a timely fashion, the automatic renewal provisionwas triggered.
The notice provision can reasonably be interpreted, as it is by plaintiff, to require writteninstructions for crating and shipping the copiers, but defendant's interpretation is also reasonable. Acontract is ambiguous if "reasonably susceptible of more than one interpretation" (Chimart Assoc. vPaul, 66 NY2d 570, 573 [1986]; see also Federal Ins. Co. v Americas Ins. Co., 258AD2d 39, 43 [1999] [in situations where "internal inconsistencies in a contract point() to (an)ambiguity, extrinsic evidence is admissible to determine the parties' intent"]). As parol evidence isnecessary to interpret the contract, summary judgment is not warranted. Concur—Gonzalez,P.J., Saxe, Nardelli, McGuire and Moskowitz, JJ.