Ampower-US, LLC v. WEG Transformers USA, LLC

• Docket Number: 533817
• Decision Date: 16 March 2023
• Citation: 214 A.D.3d 1129,185 N.Y.S.3d 811
• Parties: AMPOWER–US, LLC, Appellant, v. WEG TRANSFORMERS USA, LLC, et al., Respondents.
• Court: New York Supreme Court — Appellate Division

214 A.D.3d 1129

185 N.Y.S.3d 811

AMPOWER–US, LLC, Appellant,

v.WEG TRANSFORMERS USA, LLC, et al., Respondents.

533817

Supreme Court, Appellate Division, Third Department, New York.

Calendar Date: January 9, 2023

Decided and Entered: March 16, 2023

Bond, Schoeneck & King PLLC, Rochester (Jeremy M. Sher of counsel), for appellant.

The Wagoner Law Firm PLLC, Albany (Matthew D. Wagoner of counsel), for respondents.

Before: Egan Jr., J.P., Clark, Pritzker, Ceresia and Fisher, JJ.

MEMORANDUM AND ORDER

Fisher, J. Appeals (1) from an order of the Supreme Court (Christina L. Ryba, J.), entered June 26, 2020 in Albany County, which denied plaintiff's motion for partial summary judgment, and (2) from an order and judgment of said court (Roger D. McDonough, J.), entered July 13, 2021 in Albany County, upon a decision of the court in favor of defendants.

In 2016, plaintiff entered into an asset purchase agreement (hereinafter APA) with CG Power USA (hereinafter CG Power) and its parent company, defendant Crompton Greaves Limited (hereinafter Crompton Greaves), whereby plaintiff agreed to purchase certain assets from CG Power known as the PSOL Division. The APA established a closing date of no later than September 13, 2016 and contained certain conditions precedent to each party's obligation to close on that specified date. The APA also contained a provision whereby either party could terminate the agreement if the closing did not occur by the specified date. According to plaintiff, it was ready, willing and able to complete the sale on the specified closing date of September 13, but CG Power failed to satisfy its obligations under the APA and ultimately terminated the agreement on September 14.

Plaintiff commenced this action asserting causes of action for breach of contract and for indemnification under the APA. CG Power and Crompton Greaves joined issue and asserted a counterclaim for a declarative judgment declaring that the APA was terminated because the closing did not occur by the contractually-required date. Defendant WEG Transformers USA, LLC (hereinafter WEG) was substituted as successor in interest to CG Power. Following the denial of plaintiff's motion for partial summary judgment by Supreme Court (Ryba, J.),¹ the matter proceeded to a bifurcated nonjury trial on liability and damages. Supreme Court (McDonough, J.) ultimately found that plaintiff failed to demonstrate that it satisfied its conditions precedent and that is was otherwise ready, willing and able to close by the specified date in the APA. As a result, the court found in favor of defendants, awarded plaintiff no damages and issued a declaration that the language of the APA allowed CG Power to terminate the agreement on September 14, 2016. Plaintiff appeals.

We affirm. "When conducting a review of a nonjury trial verdict, this Court independently reviews the probative weight of the evidence, together with the reasonable inferences that may be drawn therefrom, and grants the judgment warranted by the record while according due deference to the trial court's factual findings and credibility determinations" ( Grimaldi v. Sangi, 177 A.D.3d 1208, 1209–1210, 113 N.Y.S.3d 771 [3d Dept. 2019] [internal quotation marks, brackets and citations omitted], lv denied 37 N.Y.3d 907, 2021 WL 4163887 [2021] ). Initially, the parties concede that the APA is unambiguous, and, therefore, "[i]t is well settled that a contractual agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms" ( McCarthy Concrete, Inc. v. Banton Constr. Co., 203 A.D.3d 1496, 1499, 166 N.Y.S.3d 306 [3d Dept. 2022] [internal quotation marks and citations omitted], lv denied 38 N.Y.3d 913, 2022 WL 4240872 [2022] ).

As such, "[a] cause of action for breach of contract requires that the plaintiff show the existence of a contract, the performance of its obligations under the contract, the failure of the defendant to perform its obligations and damages resulting from the defendant's breach" ( Daire v. Sterling Ins. Co., 204 A.D.3d 1189, 1190, 167 N.Y.S.3d 197 [3d Dept. 2022] [internal quotation marks, brackets and citation omitted]). However, "no action for breach of contract lies where the party seeking to enforce the contract has failed to perform a specified condition precedent" ( Redwing Constr. Co., Inc. v. Sexton, 181 A.D.3d 1027, 1028, 120 N.Y.S.3d 215 [3d Dept. 2020] [internal quotation marks, brackets and citations omitted]). To that end, "a contractual duty ordinarily will not be construed as a condition precedent absent clear language showing that the parties intended to make it a condition" ( Granger Constr. Co., Inc. v. TJ, LLC, 134 A.D.3d 1329, 1330, 21 N.Y.S.3d 491 [3d Dept. 2015] [internal quotation marks, brackets and citations omitted]; see Shmaltz Brewing Co., LLC v. Dog Cart Mgt. LLC, 202 A.D.3d 1349, 1351, 163 N.Y.S.3d 659 [3d Dept. 2022] ).

Here, sections 5 and 6 of the APA were labeled "[c]onditions precedent" for each respective party's obligation to close on the specified date. It is clear, based on the language of these sections and the contents therein, and further because both parties concede that the APA is unambiguous, that the parties intended for the enumerated obligations under sections 5 and 6 to function as conditions precedent to closing on September 13, 2016 (see Shmaltz Brewing Co., LLC v. Dog Cart Mgt. LLC, 202 A.D.3d at 1351, 163 N.Y.S.3d 659 ; Squire McBeasley, Inc. v. 36th Str, LLC, 93 A.D.3d 1123, 1123–1124, 941 N.Y.S.2d 328 [3d Dept. 2012] ).

Section 5 set forth certain obligations that plaintiff was required to satisfy before the specified closing date. As conceded during the testimony of plaintiff's president, and as our independent review of the record confirms, plaintiff failed to satisfy several conditions precedent before the specified closing date and cannot establish a breach of contract cause of action (see Redwing Constr. Co., Inc. v. Sexton, 181 A.D.3d at 1028, 120 N.Y.S.3d 215 ). Notably, plaintiff failed to obtain a financing commitment pursuant to section 5(h) of the APA.² In its attempt to excuse its failure to provide certain closing deliverables, plaintiff argues that its conditions precedent could be waived in writing at its election. However, as further admitted by the president during his testimony, that simply did not occur. Plaintiff's alternate interpretation of the APA, specifically section 5(h), is unpersuasive and against the plain meaning of its terms (see Ficel Transp., Inc. v. State of New York, 209 A.D.3d 1153, 1155, 177 N.Y.S.3d 356 [3d Dept. 2022] ; McCarthy Concrete, Inc. v. Banton...