Air Master Sales Co. v. Northbridge Park Co-Op, Inc.

• Decision Date: 19 September 1990
• Docket Number: Civ. A. No. 90-725.
• Citation: 748 F. Supp. 1110
• Parties: AIR MASTER SALES CO., Plaintiff, v. NORTHBRIDGE PARK CO-OP, INC., Defendant.
• Court: U.S. District Court — District of New Jersey

748 F. Supp. 1110

AIR MASTER SALES CO., Plaintiff, v. NORTHBRIDGE PARK CO-OP, INC., Defendant.

Civ. A. No. 90-725.

United States District Court, D. New Jersey.

September 19, 1990.

Gary A. DeVito, Zarwin & Baum, P.C., Audubon, N.J., for plaintiff.

Steven Pontell, Verde, Steinbeg & Pontell, Fort Lee, N.J., for defendant.

ORDER

LECHNER, District Judge.

This diversity contract matter is before the court on motion of defendant Northbridge Park Co-Op, Inc. ("Northbridge") for summary judgment and on cross-motion of plaintiff Air Master Sales Co. ("Air Master") for summary judgment. Jurisdiction appears to be appropriate. See 28 U.S.C. § 1332. For the reasons set forth below, the motion by Northbridge is granted; the cross-motion by Air Master is denied.

Facts¹

A. Procedural History

On 29 August 1989, Air Master filed an action against Northbridge in the Eastern District of Pennsylvania. This action was dismissed on or about 7 December 1989 for lack of personal jurisdiction. See Memorandum in Support of Order regarding Air Master Sales Co. v. Northbridge Park Co-Op, Inc., Civ. No. 89-6276, dated 5 December 1989 ("Memorandum"), 1989 WL 149967.

On or about 27 February 1990 the instant action was filed by Air Master this district. A scheduling conference was held on 25 May 1990. A bench trial is scheduled for 24 September 1990.

The first count of the Complaint in this action contends Northbridge breached a direct agreement with Air Master, which agreement resulted from negotiations between Air Master and Northbridge. The second and third counts of the Complaint contend Air Master relied to its detriment on the approval by Northbridge of windows it manufactured and specially manufactured windows for Northbridge. It is also contended in these counts Northbridge was fully knowledgeable that Air Master was proceeding with the manufacture of these windows. The fourth count contends Air Master was an intended beneficiary of a contract between Northbridge and Tri-State Window Outlet, Inc. ("Tri-State"). The fifth count contends Tri-State was acting as an agent, servant and employee of Northbridge.²

B. Undisputed Facts

Northbridge is a New Jersey corporation with its principal place of business at 2200 North Central Road, Fort Lee, New Jersey. Northbridge is the owner of a multiple dwelling residential apartment building at that address (the "Apartment Building"). Air Master is a Pennsylvania corporation and is in the business of manufacturing and selling aluminum replacement windows and doors. Tri-State is also a New Jersey corporation and is in the business of installing and servicing windows.

On 17 December 1987, Tri-State entered into a contract with Northbridge (the "Tri-State Contract"). See Exhibit A to the Monaco Cert. The terms of the Tri-State Contract indicate that Tri-State would provide and install an estimated 2,444 windows at the Apartment Building for a cost of $452,140.00. Id. at ¶ 3. The Tri-State Contract also indicated that the windows to be installed would "be Air Master's White Aluminum A2.5 Replacement Tilt Window, model 302, with custom made exterior panning and interior aluminum snap trim." Id., ¶ 2. This contract was only between Tri-State and Northbridge. There is nothing to suggest Air Master had any standing under the Tri-State Contract to require Tri-State to comply with its terms and install the Air Master windows at the Apartment Building.

Apparently in an attempt to discharge its obligations under the Tri-State Contract, Tri-State entered into a contract with Air Master, dated 12 January 1988 (the "Air Master Contract") for the purpose of purchasing windows for installation at the Apartment Building under the Tri-State Contract. The Air Master Contract is between only Air Master and Tri-State.

Shortly after Tri-State began installation of the windows at the Apartment Building, Northbridge terminated the Tri-State Contract. Northbridge was unhappy with Tri-State's installation of the windows.³ Following the dismissal of Tri-State, Northbridge attempted to negotiate a separate agreement with Air Master so that Northbridge could purchase the windows directly from Air Master. See Defendant's Brief at 5. In the Nackson Letter, dated 19 July 1988, an attorney for Northbridge, Joseph Lewis Nackson ("Nackson"), wrote to Air Master and stated:

This letter serves to confirm our previous conversations.

You had advised me that Air Master would in fact credit my client Northbridge with the sum of $55,000. Said sum having previously been paid to Air Master by Tri-State.

As you know, Tri-State could not properly install the windows at Northbridge's Co-Op. As a result of such difficulty, Northbridge will be hiring a separate window installer and intends to purchase those windows ordered by Tri-State from your company. We also wish to confirm a present unit price to Northbridge of $144.00.

Would you kindly sign a copy of this letter at the appropriate place indicating Air Master's affirmance of these terms.

Nackson Letter.

Although the Nackson Letter appears to indicate there was an agreement between Air Master and Northbridge for the purchase of windows by Northbridge, Air Master did not unequivocally approve of the terms in the Nackson Letter. In accepting the contents of the Nackson Letter, Daniel Monaco, Vice President of Air Master, indicated approval on behalf of Air Master but only based upon an additional condition to be performed by Northbridge — the presentation to Air Master of a Northbridge purchase order. Specifically, Monaco stated with regard to the confirmation of the terms of the Nackson Letter: "This confirmation will be valid only when Air Master receives a Purchase Order from Northbridge Park Co-Op for the windows." See Exhibit D to the Monaco Cert. (emphasis added).

Monaco, on behalf of Air Master, sent the Nackson Letter back to Nackson along with a cover letter requesting arrangements be made as soon as possible for the delivery of the windows to the Apartment Building. See Exhibit E to Monaco Cert.

During the negotiations over the purchase of the windows by Northbridge from Air Master, Northbridge hired the architectural firm of Hyun & Siri (the "Architects") to prepare specifications for the installation of the windows of Northbridge. The Architects reported that the windows installed by Tri-State and manufactured by Air Master were not the proper windows for the building.⁴ After receiving the report, the Board of Directors decided not to purchase the windows from Air Master.

Northbridge did not deliver, execute or even prepare a purchase order to Air Master, as required by Air Master's Vice President, Daniel Monaco. The parties had no further communication until the litigation was initiated.

C. The Summary Judgment Standard

To prevail on a motion for summary judgment, the moving party must establish "there is no genuine issue as to any material fact and that it is entitled to judgment as a matter of law." Fed.R. Civ.P. 56(c). The district court's task is to determine whether disputed issues of fact exist, but the court cannot resolve factual disputes in a motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 2510-11, 91 L.Ed.2d 202 (1986). All evidence submitted must be viewed in a light most favorable to the party opposing the motion. See Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986).

Although the summary judgment hurdle is a difficult one to overcome, it is by no means insurmountable. As the Supreme Court has stated, once the party seeking summary judgment has pointed out to the court the absence of a fact issue,

its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. ... In the language of the Rule, the nonmoving party must come forward with `specific facts showing that there is a genuine issue for trial.' ... Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no `genuine issue for trial.'

Matsushita, 475 U.S. at 586-87, 106 S.Ct. at 1355-56 (emphasis in original, citations and footnotes omitted).

The Supreme Court elaborated on the standard in Anderson v. Liberty Lobby, Inc.: "If the evidence submitted by a party opposing summary judgment is merely colorable ... or is not significantly probative ... summary judgment may be granted." 477 U.S. at 249-50, 106 S.Ct. at 2510-11 (citations omitted). The Supreme Court went on to note in Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986): "One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses, and we think it should be interpreted in a way that allows it to accomplish this purpose." Id. at 323-24, 106 S.Ct. at 2552-53 (footnote omitted). Thus, once a case has been made in support of summary judgment, the party opposing the motion has the affirmative burden of coming forward with specific facts evidencing a need for trial. See Fed.R.Civ.P. 56(e).

In diversity actions, federal courts determine the substantive law to be applied by looking to the choice of law rules of the forum state. Van Dusen v. Barrack, 376 U.S. 612, 645-46, 84 S.Ct. 805, 11 L.Ed.2d 945 (1964); Klaxon Co. v. Stentor Electronic Mfg. Co., 313 U.S. 487, 496-97, 61 S.Ct. 1020, 1021-22, 85 L.Ed. 1477 (1941); Petrella v. Kashlan, 826 F.2d 1340, 1343 (3d Cir.1987).

D. The Nackson Letter

A contract is formed where the essential terms of an agreement have been communicated between the parties and there has been mutual assent to those terms. Knight v. New England Mut. Life Ins. Co., 220 N.J.Super. 560, 565, 533 A.2d 55 (App.Div.1987), certif. denied, 110 N.J. 184, 540 A.2d 180 (1988); St. Barnabus Med. Center v. Essex Co., 211 N.J.Super. 488, 495, 511 A.2d 1287 (L.Div.1986), rev'd on other grounds, 216...