| Minovici v Belkin BV |
| 2013 NY Slip Op 05618 [109 AD3d 520] |
| August 14, 2013 |
| Appellate Division, Second Department |
| Catalin Minovici, Also Known as Alin Minovici, et al.,Appellants, v Belkin BV et al., Respondents. |
—[*1] Bryan Cave LLP, New York, N.Y. (Jay P. Warren of counsel), forrespondents.
In an action, inter alia, to recover damages for breach of contract, the plaintiffsappeal from an order of the Supreme Court, Dutchess County (Pagones, J.), datedJanuary 5, 2012, which granted the defendants' motion to dismiss the complaint pursuantto CPLR 3211 (a) (1) and (7).
Ordered that the order is modified, on the law, by deleting the provision thereofgranting those branches of the defendants' motion which were pursuant to CPLR 3211(a) (1) and (7) to dismiss the seventh cause of action, which was for a judgment declaringthat the defendants breached their obligations under a certain employment contract withthe plaintiff Catalin Minovici, also known as Alin Minovici, and substituting therefor aprovision denying those branches of the motion; as so modified, the order is affirmed,with costs to the defendants, and the matter is remitted to the Supreme Court, DutchessCounty, for the entry of a judgment, inter alia, declaring that the defendants did notbreach their obligations under the subject employment contract.
The plaintiff Catalin Minovici, also known as Alin Minovici (hereinafter Catalin),entered into a written employment contract dated May 1, 2008, with the defendantBelkin, Ltd., pursuant to which he agreed to serve in its offices in the United Kingdom asthe Information Systems (hereinafter IS) Director. One month later, and before workstarted, Catalin entered into a written employment contract dated June 10, 2008(hereinafter the June 2008 employment contract), for the same position with thedefendant Belkin BV, pursuant to which he agreed to serve in its offices in theNetherlands. Catalin, allegedly in reliance upon the June 2008 employment contract, aswell as the defendants' representations, took certain steps necessary to relocate to theNetherlands, including the sale of his house in Dutchess County. Prior to the start date ofhis employment, an agent of Belkin BV notified Catalin that his position was no longeravailable, and offered him a junior position at a lower salary.
Catalin and his wife, the plaintiff Laura Minovici (hereinafter together the plaintiffs),commenced this action alleging, inter alia, causes of action to recover damages forbreach of contract (the first cause of action), and breach of the covenant of good faithand fair dealing (the fifth cause of action), as well as causes of action sounding in fraudand fraudulent inducement (the second, third, and fourth causes of action), andintentional infliction of emotional distress (the sixth cause [*2]of action). The plaintiffs also sought a judgment declaringthat the defendants breached their obligations under the June 2008 employment contract(the seventh cause of action). The defendants moved to dismiss the complaint pursuant toCPLR 3211 (a) (1) and (7). The Supreme Court granted the defendants' motion.
The Supreme Court correctly granted those branches of the defendants' motion whichwere pursuant to CPLR 3211 (a) (1) and (7) to dismiss the first cause of action, whichalleged breach of contract. On a motion to dismiss a complaint pursuant to CPLR 3211(a) (7), the court must liberally construe the complaint, accept all facts as alleged in thepleading to be true, accord the plaintiff the benefit of every favorable inference, anddetermine only whether the facts as alleged fit within any cognizable legal theory (seeLeon v Martinez, 84 NY2d 83, 87-88 [1994]; Rabos v R&R Bagels & Bakery, Inc., 100 AD3d 849, 851[2012]; Daub v Future TechEnter., Inc., 65 AD3d 1004, 1005 [2009]). Further, the court may consider anyfactual submissions made in opposition to a motion to dismiss a pleading in order toremedy pleading defects (seeQuinones v Schaap, 91 AD3d 739, 740 [2012]; Daub v Future Tech Enter.,Inc., 65 AD3d at 1005). Nevertheless, "bare legal conclusions and factual claimswhich are flatly contradicted by the record are not presumed to be true" (Parola, Gross & Marino, P.C. vSusskind, 43 AD3d 1020, 1021-1022 [2007]; see Daub v Future TechEnter., Inc., 65 AD3d at 1005). Moreover, "[w]here evidentiary material is submittedand considered on a motion to dismiss a complaint pursuant to CPLR 3211 (a) (7), andthe motion is not converted into one for summary judgment, the question becomeswhether the plaintiff has a cause of action, not whether the plaintiff has stated one, andunless it has been shown that a material fact as claimed by the plaintiff to be one is not afact at all and unless it can be said that no significant dispute exists regarding it,dismissal should not eventuate" (Rabos v R&R Bagels & Bakery, Inc., 100AD3d at 851-852; see Guggenheimer v Ginzburg, 43 NY2d 268, 274-275[1977]).
A motion to dismiss a complaint based on documentary evidence pursuant to CPLR3211 (a) (1) may only be granted "where the documentary evidence utterly refutesplaintiff's factual allegations, conclusively establishing a defense as a matter of law"(Goshen v Mutual Life Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]; seeRabos v R&R Bagels & Bakery, Inc., 100 AD3d at 851).
"New York adheres to the traditional common-law rule that absent an agreementestablishing a fixed duration, an employment relationship is presumed to be a hiring atwill, terminable at any time by either party" (Monheit v Petrocelli Elec. Co., Inc., 73 AD3d 714, 715[2010]; see Smalley v DreyfusCorp., 10 NY3d 55, 58 [2008]; Horn v New York Times, 100 NY2d 85,90-91 [2003]). In support of their motion to dismiss the complaint, the defendantssubmitted the June 2008 employment contract, setting forth the terms of the employmentrelationship. The June 2008 employment contract contained a merger clause reciting thatthe writing encompassed the entire agreement between the parties. Contrary to theplaintiffs' contention, the June 2008 employment contract did not provide for a fixed ordefinite term of employment, as it expressly provided that Catalin was to be employed"for an indefinite period of time." Moreover, the June 2008 employment contractprovided that either party could, without notice, terminate the employment relationshipwith immediate effect during the first two months after its execution, and thereafter withcertain notice. Further, the plaintiffs themselves alleged in the complaint that, pursuant tothe June 2008 employment contract, Catalin's employment was "to continue without anyspecific date for termination." Thus, Catalin was presumptively an at-will employee(see Rooney v Tyson, 91 NY2d 685, 689 [1998]; Rossetti v Aretakis, 78 AD3d1148, 1149 [2010]; Devanyv Brockway Dev., LLC, 72 AD3d 1008, 1008-1009 [2010]). The plaintiffsfailed to allege facts that would rebut the at-will presumption or limit Belkin BV's rightto freely terminate Catalin's employment.
Contrary to the plaintiffs' contention, Belkin BV's offer to pay Catalin a housingallowance for a maximum of two years did not create a fixed term of employment orrebut the presumption of at-will employment. This offer was incidental to Catalin'semployment and did not, in any way, bind the parties to a two-year term of employment(see Chase v United Hosp., 60 AD2d 558, 559 [1977]; Johnson v CheneyBros., 277 App Div 656, 658-659 [1951]; see also Cartwright v GolubCorp., 51 AD2d 407, 409 [1976]).
The plaintiffs contend that the earlier contract, dated May 1, 2008, pursuant to which[*3]Catalin agreed to serve as IS Director in the UnitedKingdom, altered the terms of employment as set forth in the subsequent June 2008employment contract. However, the contract dated May 1, 2008, was superseded by theJune 2008 employment contract, since it covered the same subject matter (seeNorthville Indus. Corp. v Fort Neck Oil Terms. Corp., 100 AD2d 865, 867 [1984],affd 64 NY2d 930 [1985]; Medtech Prods. Inc. v Ranir, LLC, 596 FSupp 2d 778, 809-810 [SD NY 2008]). Furthermore, the complaint's allegations as toCatalin's conduct, which included preparations taken to move to the Netherlands,demonstrated an abandonment of the contract dated May 1, 2008 (see Jones vTrice, 202 AD2d 394, 395 [1994]).
Contrary to the plaintiffs' contention, Belkin BV's offer to Catalin of a junior-rankingposition at a lower salary did not constitute a breach of the June 2008 employmentcontract. When there is an at-will employment relationship, the employer may unilaterallyalter the terms of employment, and the employee may end the employment if the newterms are unacceptable (see Hanlon v Macfadden Publs., 302 NY 502, 505[1951]; Kronick v L.P. ThebaultCo., Inc., 70 AD3d 648, 649 [2010]; JCS Controls, Inc. v Stacey, 57 AD3d 1372, 1373-1374[2008]).
Furthermore, since Catalin was an employee at-will, the fifth cause of action, whichalleged that the defendants violated the covenant of good faith and fair dealing impliedinto the employment contract, provides no basis for recovery, and the Supreme Courtproperly granted those branches of the defendants' motion which were to dismiss thatcause of action pursuant to CPLR 3211 (a) (1) and (7) (see Murphy v AmericanHome Prods. Corp., 58 NY2d 293, 304-305 [1983]; DiLacio v New York City Dist.Council of United Bhd. of Carpenters & Joiners of Am., 80 AD3d 553, 554[2011]; McGimpsey v J. RobertFolchetti & Assoc., LLC, 19 AD3d 658, 659 [2005]; Riccardi vCunningham, 291 AD2d 547, 548 [2002]).
The Supreme Court correctly granted those branches of the defendants' motion whichwere to dismiss the second, third, and fourth causes of action, which sounded in fraudand fraudulent inducement, as they were duplicative of the breach of contract cause ofaction (see Clark-Fitzpatrick, Inc. v Long Is. R.R. Co., 70 NY2d 382, 389[1987]; Arias v Women in Need, 274 AD2d 353 [2000]; Tannehill v PaulStuart, Inc., 226 AD2d 117, 118 [1996]; Cleffi v Crescent Beach Club, 222AD2d 642, 643 [1995]; Clark v Helmsley Windsor Hotel, 214 AD2d 365 [1995];Nagle v Shearson Lehman Bros., 190 AD2d 568, 569 [1993]).
In addition, the Supreme Court correctly granted that branch of the defendants'motion which was to dismiss the sixth cause of action, which sounded in intentionalinfliction of emotional distress. The act of terminating an at-will employmentrelationship "may not form the basis of an intentional infliction of emotional distresscause of action in circumvention of the at-will employment rule in New York" (Famav American Intl. Group, 306 AD2d 310, 311-312 [2003]; see Murphy vAmerican Home Prods. Corp., 58 NY2d at 303; Peterec-Tolino v Harap, 68 AD3d 1083, 1084 [2009];Abeles v Mellon Bank Corp., 298 AD2d 106 [2002]).
However, the Supreme Court improperly granted that branch of the defendants'motion which was to dismiss the seventh cause of action, which sought a declaratoryjudgment. " 'A motion to dismiss a declaratory judgment action prior to the service of ananswer presents for consideration only the issue of whether a cause of action fordeclaratory relief is set forth, not the question of whether the plaintiff is entitled to afavorable declaration' " (Matterof Tilcon N.Y., Inc. v Town of Poughkeepsie, 87 AD3d 1148, 1150 [2011],quoting Staver Co. v Skrobisch, 144 AD2d 449, 450 [1988]). "Thus, 'where acause of action is sufficient to invoke the court's power to render a declaratory judgment. . . as to the rights and other legal relations of the parties to a justiciablecontroversy, a motion to dismiss that cause of action should be denied' " (DiGiorgio v 1109-1113 ManhattanAve. Partners, LLC, 102 AD3d 725, 728 [2013], quoting Matter of TilconN.Y., Inc. v Town of Poughkeepsie, 87 AD3d at 1150). A court may reach "themerits of a properly pleaded cause of action for a declaratory judgment upon a motion todismiss for failure to state a cause of action where 'no questions of fact are presented [bythe controversy]' " (Matter of Tilcon N.Y., Inc. v Town of Poughkeepsie, 87AD3d at 1150, quoting Hoffman v City of Syracuse, 2 NY2d 484, 487 [1957]).Under such circumstances, the motion to dismiss the cause of action for failure to state acause of action "should be taken as a motion for a declaration in the defendant's favorand treated accordingly" (Siegel, NY Prac § 440 [5th ed]; see Lanza vWagner, 11 NY2d 317, 334 [1962], appeal dismissed 371 US [*4]74 [1962], cert denied 371 US 901 [1962];Matter of Tilcon N.Y., Inc. v Town of Poughkeepsie, 87 AD3d at 1150). Here,since there were no factual issues concerning the parties' rights under the June 2008employment contract, the Supreme Court should have denied those branches of themotion which were pursuant to CPLR 3211 (a) (1) and (7) to dismiss the seventh causeof action, and instead entered a judgment declaring that the defendants did not breachtheir obligations under the June 2008 employment contract.
Contrary to the plaintiffs' contention, the Supreme Court properly applied New Yorklaw when determining the defendants' motion, as the plaintiffs failed to plead thesubstance of the foreign law to be applied, and their opposition papers failed to providesufficient information concerning the foreign law at issue (see CPLR 3016 [e];4511 [b]; Ponnambalam vSivaprakasapillai, 35 AD3d 571, 574 [2006]; Bank of N.Y. v NorilskNickel, 14 AD3d 140, 148-149 [2004]). To the extent that the plaintiffs haveattempted to rectify this failure for the first time on appeal, their contentions are notproperly before this Court (see Ponnambalam v Sivaprakasapillai, 35 AD3d at574).
The plaintiffs' remaining contentions are without merit.
Since this is, in part, a declaratory judgment action, the matter must be remitted to theSupreme Court, Dutchess County, for the entry of a judgment, inter alia, declaring thatthe defendants did not breach their obligations under the June 2008 employment contract(see Lanza v Wagner, 11 NY2d at 334). Balkin, J.P., Hall, Lott and Miller, JJ.,concur. [Prior Case History: 34 Misc 3d 1205(A), 2012 NY Slip Op 50001(U).]