N. Feldman & Son, Ltd. v. Checker Motors Corp.

• Decision Date: 18 April 1983
• Docket Number: No. 81 Civ. 4502 (KTD).,81 Civ. 4502 (KTD).
• Citation: 572 F. Supp. 310
• Parties: N. FELDMAN & SON, LTD., Plaintiff, v. CHECKER MOTORS CORP. and General Motors Corp., Defendants.
• Court: U.S. District Court — Southern District of New York

572 F. Supp. 310

N. FELDMAN & SON, LTD., Plaintiff, v. CHECKER MOTORS CORP. and General Motors Corp., Defendants.

No. 81 Civ. 4502 (KTD).

United States District Court, S.D. New York.

April 18, 1983.

COPYRIGHT MATERIAL OMITTED

Parker Chapin Flattau & Klimpl, New York City, for plaintiff; Barry J. Brett, Michael D. Friedman, New York City, of counsel.

Walter, Conston, Schurtman & Gumpel, P.C., New York City, for defendant Checker Motors Corp.; William Schurtman, Peter Kober, New York City, of counsel.

Weil Gotshal & Manges, New York City, for defendant General Motors Corp.; Kevin P. Hughes, David N. Lawrence, New York City, of counsel.

MEMORANDUM & ORDER

KEVIN THOMAS DUFFY, District Judge:

Defendant, Checker Motors Corporation ("Checker"), moves herein to strike plaintiff's demand for a jury trial and appeals from two rulings by Magistrate Bernikow regarding the extension of the September 30, 1982 discovery cutoff date. Defendant, General Motors Corporation ("GM"), moves herein for summary judgment. I will consider and determine each of these motions and Checker's appeal separately below.

BACKGROUND

On July 21, 1981, plaintiff, N. Feldman & Sons, Ltd. ("Feldman"), an Israeli importer and distributor of agricultural, construction, and automotive equipment, brought this action against defendants Checker, a manufacturer of taxicabs, and GM, a manufacturer of diesel engines.

The plaintiff's allegations are based, in part, on its July 20, 1979 agreement with Checker whereby Checker agreed to supply Feldman with taxicabs equipped with diesel engines. Pursuant to an earlier agreement between Checker and GM, GM agreed to supply the diesel engines for installation in these taxicabs. In 1979, plaintiff purchased 18 taxicabs from Checker that were equipped with GM diesel engines. Plaintiff now contends that because these taxicabs and their engines were defective both defendants should be held liable. The complaint asserts claims of breach of contract, breach of express and implied warranties, fraud, negligence, strict liability in tort, and conspiracy. The complaint seeks millions of dollars in compensatory and punitive damages and demands a jury trial of all issues.

Checker and GM filed separate answers to plaintiff's complaint. Checker asserted various affirmative defenses and counterclaims including an affirmative defense that under paragraph 19(6) of the July 20, 1979 agreement, Feldman had waived a jury trial against Checker. GM asserted that it had no dealings with plaintiff, and therefore could not be held liable to Feldman. Checker subsequently filed a cross-claim against GM, seeking reimbursement, indemnity, and contribution with respect to any damages that Feldman might recover against Checker by reason of the alleged defects in the GM engines. As of this date, all parties have engaged in extensive discovery proceedings.

A. MOTION TO STRIKE PLAINTIFF'S JURY DEMAND

Checker moves to strike plaintiff's demand for a jury trial. Checker contends that plaintiff contractually waived its right to a jury trial in paragraph 19(6) of their July 20, 1979 agreement, which provides:

Checker and Dealer both acknowledge and agree that any controversy which may arise under this agreement or the relationship established hereby would be based upon difficult and complicated issues, and therefore, the parties agree that any law suit growing out of any such controversy will be tried in a court of competent jurisdiction by a judge sitting without a jury.

In support of its motion, Checker notes that plaintiff's complaint both relies on this written agreement and seeks to enforce its terms. Therefore, Checker argues, plaintiff also should be bound by the contractual waiver of a jury.

Checker further asserts that plaintiff knowingly and voluntarily consented to waive a jury trial when, after years of negotiations and correspondence, Feldman signed the agreement which visibly and expressly provided for this waiver. Plaintiff contends, however, that it was not represented by counsel at the time of the contract signing, and that this lack of representation along with the "boilerplate" nature of the jury trial waiver provision, render the waiver unenforceable.

I find plaintiff's position unpersuasive. Although the right to trial by jury is constitutionally guaranteed, an individual may knowingly and intentionally waive this right. See National Equipment Rental Ltd. v. Hendrix, 565 F.2d 255, 258 (2d Cir.1977); see also Seligson v. Plum Tree, Inc., 361 F.Supp. 748, 758 (E.D.Pa.1973); Northwest Airlines, Inc. v. Air Line Pilots Assoc. Int'l, 373 F.2d 136, 142 (8th Cir.1967); Van Leyden v. 360 East 55th Street Corp., 39 F.Supp. 879 (S.D.N.Y.1941). When the purported waiver exists in a contract signed prior to the contemplation of litigation, the party seeking to enforce it must demonstrate that the consent was both voluntary and informed. See National Equipment Rental Ltd. v. Hendrix, 565 F.2d at 258; Dreiling v. Peugeot Motors of America, Inc., 539 F.Supp. 402, 403 (D.Colo.1982). Checker has met this burden. The waiver provision is clearly visible and located directly above the signatures of the contracting parties. Although unrepresented at the time of contract signing, plaintiff does not fit into the category of individuals with "no real choice" but to sign the waiver provision. See, e.g., National Equipment Rental Ltd. v. Hendrix, 565 F.2d at 258. This agreement was the result of years of negotiation between the parties. Moreover, there is evidence that plaintiff had previously been a party to a similar agreement with Checker containing the same jury waiver provision. I therefore find that plaintiff knowingly and willingly waived its right to a jury trial. Checker's motion to strike plaintiff's demand for a jury trial, therefore, is granted.

B. APPEAL FROM RULINGS OF MAGISTRATE BERNIKOW

Checker appeals from Magistrate Bernikow's October 5, 1982 rulings (1) extending the discovery cutoff date in order to allow plaintiff to take oral depositions in Israel; and (2) denying defendants' application pursuant to rule 16(a) of the Local Rules of Civil Procedure, Southern District of New York, that plaintiff be required to pay in advance the expenses and a reasonable counsel fee for one attorney representing each defendant at these depositions.

Checker argues that it would be perfectly feasible and a lot cheaper for plaintiff to bring its four or five witnesses to New York to testify at trial, and that plaintiff's request for an extension to take these depositions is clearly untimely because plaintiff must have known from the inception of this action that it would require such testimony to prove its case. Furthermore, Checker contends that Magistrate Bernikow "committed clear error" in denying advance payment of defendants' fees and expenses because, absent special circumstances, prepayment of such fees and expenses in this District normally is required. Plaintiff, on the other hand, contends that Magistrate Bernikow exercised his discretion in making these determinations and that absent a finding that these rulings were "clearly erroneous or contrary to law," they should not be disturbed. I agree with the plaintiff and decline to overturn Magistrate Bernikow's rulings.

Magistrates have broad discretion regarding the completion of pretrial discovery. See Minichello v. Greyhound Lines, Inc., No. 81 Civ. 3916 (S.D.N.Y. May 19, 1982). Magistrate Bernikow's decision to extend the discovery cutoff date is clearly within his discretion and has not been shown to be "clearly erroneous or contrary to law."

In the same manner, the Magistrate's decision to deny the prepayment of defendants' fees and expenses is within his discretion. Rule 16(a) does not mandate an order of advance payment of an adversary's expenses for attendance at a deposition more than 100 miles from the courthouse, but merely provides the court with authorization to do so if the court should deem it proper. By merely citing cases in this District in which a court has chosen to exercise its discretion to the contrary, defendant has failed to meet its burden of proving the Magistrate's ruling in this instance was "clearly erroneous." Checker's appeal from Magistrate Bernikow's October 5, 1982 rulings is therefore without merit, and those rulings are in all respects affirmed.

C. MOTION FOR SUMMARY JUDGMENT

Defendant GM moves for summary judgment. Fed.R.Civ.P. 56.¹ GM contends that it had no dealings whatsoever with plaintiff, and on the basis of undisputed facts cannot be held liable under any theory of liability as a matter of law. I will consider separately GM's challenge to each of the six counts asserted against it.

(i) Breach of Express Warranty

GM contends that because it had no contact with Feldman it could not have made any representations upon which plaintiff could have relied in its purchase of Checker taxicabs. Plaintiff, however, asserts reliance by way of alleged representations made by GM to Checker, who thereafter made express warranties to plaintiff. These representations concerned engine tests allegedly done by defendants. These tests, Feldman was told, showed that the engines performed satisfactorily.

A party can be held liable for its representations if the representations were a "part of the basis of the bargain." See Mich.Comp.Laws Ann. § 440.1313.² Feldman argues that the representations noted above formed part of the bargain's basis. Plaintiff alleges that representations made by GM to Checker were in turn related to Feldman during the contract negotiation process. If GM made such representations, it could reasonably forsee that its representations would form the basis of any bargain struck by Checker. Therefore, GM is not entitled as a matter of law to summary judgment. Further material factual questions must be resolved before this Court can determine whether the requisite reliance alleged by plaintiff actually occurred in this case.

(i...