Creative Waste v. Capitol Environmental Services, 04 Civ. 9581(WCC).
| Decision Date | 21 April 2006 |
| Docket Number | No. 04 Civ. 9581(WCC).,04 Civ. 9581(WCC). |
| Citation | 429 F.Supp.2d 582 |
| Parties | CREATIVE WASTE MANAGEMENT, INC., Plaintiff, v. CAPITOL ENVIRONMENTAL SERVICES, INC., Code Environmental Services, Inc. and City of New Rochelle, New York, Defendants. City of New Rochelle, Plaintiff, v. Fidelity and Guaranty Insurance Company and United States Fidelity and Guaranty Company, Defendants. |
| Court | U.S. District Court — Southern District of New York |
Dolchin, Slotkin & Todd, P.C., Joel W. Todd, of Counsel, Philadelphia, PA, for Plaintiff Creative Waste Management, Inc.
Law Offices of Joel B. Albert, P.C., Joel B. Albert, of Counsel, Bala Cynwyd, PA, for Defendant Capitol Environmental Services, Inc.
Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, Jonathan Dryer, of Counsel, Philadelphia, PA, for Defendant Code Environmental Services, Inc.
Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, Peter A. Meisels, Lalit K. Loomba, of Counsel, White Plains, NY, for Defendant City of New Rochelle.
Wolf & Samson PC, Adam P. Friedman, of Counsel, West Orange, NJ, for Fidelity and Guaranty Insurance Company.
Plaintiff Creative Waste Management, Inc. ("Creative") brings the instant action against defendants Capitol Environmental Services, Inc. ("Capitol") and Code Environmental Services, Inc. ("Code") for breach of contract and promissory estoppel, and against the City of New Rochelle, New York ("New Rochelle" or the "City") (collectively, the "defendants") for fraudulent inducement, breach of implied covenant, mutual mistake, unilateral mistake and fraud and negligent misrepresentation (the "main action"). Capitol brings cross-claims against Code and New Rochelle for contribution and indemnification, and Code brings a cross-claim against Capitol for contribution and indemnification. Code also brings counterclaims against Creative for breach of contract and unjust enrichment. New Rochelle brings a counterclaim against Creative for breach of contract. In addition, New Rochelle has commenced a related action against Fidelity and Guaranty Insurance Company and United States Fidelity and Guaranty Company (collectively the "Surety") for breach of contract, which has been consolidated before this Court (the "consolidated action").
In the main action, defendants all move for summary judgment on Creative's claims. In addition, Code moves for summary judgment on its counterclaim against Creative, and New Rochelle moves for summary judgment on Capitol's cross-claim. New Rochelle also seeks partial summary judgment on the issue of liability against Creative and the Surety on its breach of contract claims. Also, Creative moves to amend its Complaint to allege compliance with New York General Municipal Law § 50-e.
In light of the complexity of this lawsuit, the various claims, counterclaims and cross-claims and the multiple motions for summary judgment, the Court has constructed the following chart for ease of reference.
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Party Suing → Party Sued Cause(s) of Action Moving Party
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Creative → Capitol 1) Breach of Contract Capitol
2) Promissory Estoppel
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Creative → Code 1) Breach of Contract Code
2) Promissory Estoppel
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Creative → New Rochelle 1) Fraudulent Inducement New Rochelle
2) Breach of Implied
Covenant of Good Faith
3) Mutual Mistake
4) Unilateral Mistake
5) Fraud
6) Negligent
Misrepresentation
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Capitol → Code 1) Contribution
(cross-claim) 2) Indemnification
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Capitol → New Rochelle 1) Contribution New Rochelle
(cross claim) 2) Indemnification
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Code → Creative 1) Breach of Contract Code
(counterclaim) 2) Unjust Enrichment
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New Rochelle → Creative 1) Breach of Contract New Rochelle for partial
(counterclaim) summary judgment
(on liability)
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New Rochelle → Surety 1) Breach of Contract New Rochelle for partial
(related action) summary judgment
(on liability)
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For the reasons stated herein, Capitol's motion against Creative is granted in part, denied in part; Code's motion against Creative is granted in part, denied in part; and New Rochelle's motion against Creative is granted in part, denied in part. Code's motion on the counterclaim against Creative is denied. New Rochelle's motion for partial summary judgment on its counterclaim against Creative is denied, as is its motion against the Surety. Capitol's motion for summary judgment on its cross-claim against New Rochelle is also denied. Creative's motion to amend its Complaint is denied.
New Rochelle, located on the north shore of Long Island Sound (the "Sound"), operates the New Rochelle Municipal Marina (the "Marina"), which is located where Ferris Creek meets the Sound, an area commonly referred to as Echo Bay.1 (New Rochelle Rule 56.1 Stmt. ¶¶ 7, 8.) This case arises out of contract disputes regarding a project of the City to dredge sediment from the Sound floor in the area in and around the Marina (the "Project").
The City retained Daniel Natchez & Associates ("Natchez") to plan and obtain regulatory approval for the Project. (Natchez Dep. at 27-28.) Natchez's proposal plan called for mechanical dredging and open water disposal of dredged material. (New Rochelle Rule 56.1. Stmt. ¶¶ 11, 24; Pl. 3/10/06 Rule 56.1 Stmt. ¶ 15.) Plan approval had to be obtained from the New York State Department of Environmental Conservation ("NYDEC"), the Connecticut Department of Environmental Protection ("CTDEP") and the United States Army Corps of Engineers ("USACE"). (Clemente Aff. ¶¶ 9, 12, 15.) To obtain regulatory approval, certain tests with respect to grain size and bulk sediment needed to be performed. (Natchez Dep. at 28.) In October 1996, Natchez collected four core samples of bottom sediment to determine its chemical and physical characteristics (the "1996 tests").2 (Clemente Aff. ¶ 11.) Natchez then selected laboratories to perform the analysis of the samples and provide the results to the regulatory agencies. (Natchez Dep. at 28.) Natchez then filed an application for the Project on behalf of the City with NYDEC, which issued a permit for the Project on July 15, 1997. (New Rochelle Rule 56.1 Stmt. ¶¶ 14, 15; Pl. 3/10/06 Rule 56.1 Stmt. ¶ 15.)
On November 4, 1997, the EPA sent a letter to USACE requesting additional testing of the sediment. (Natchez Dep., Ex. N-7.) This was followed by a November 5, 1997 letter from CTDEP to USACE requesting the same. (Id.) Apparently, both agencies expressed concern with dioxin levels in the sediment, and indicated bioassay testing would have to be performed prior to the issuance of any permits.3 (Id.) Plaintiff, relying on Daniel Natchez's deposition testimony, asserts that the initial testing of the dredged material revealed elevated metal levels of concern to the New York State Department of State. (Pl. 3/10/06 Rule 56.1 Stmt. ¶ 16.) However, USACE did not request that Natchez perform further testing based on the concerns raised in the letters sent by EPA and CTDEP until October 2000.4 (Natchez Dep. at 96-98, Ex. N-15.) Seven samples were collected by Natchez and were sent for analysis in December 2000 (the "2000 tests"). (Clemente Aff. at ¶ 14.) The results were submitted to USACE. (Id.; New Rochelle Mem. Supp. Mot. Summ. J., Ex. 5.) Based on these results, Natchez determined that upland disposal of the dredged material would not be logistically or economically feasible because the dredged material was not suitable for unconfined open water disposal. (Natchez Dep. at 38.) Due to various concerns and the likely need for further testing in view of the 2000 test results, the City decided to pursue an alternative dredging plan.5 (New Rochelle Rule 56.1 Stmt. ¶¶ 20-22; Clemente Aff. ¶¶ 17-19.)
Charles Pound, president of Aqua Dredge, Inc. ("Aqua Dredge"), contacted the City by letter dated July 10, 2001 and proposed a "more cost effective and efficient" hydraulic dredging plan with upland disposal of the dredged material. (New Rochelle Rule 56.1 Stmt. ¶¶ 22, 24; New Rochelle Mem. Supp. Mot. Summ. J., Ex. 7.) Pound subsequently was retained by the City to design a dredging project and to obtain the necessary government permits.6 (New Rochelle Rule 56.1 Stmt. ¶ 26.)
On August 22, 2001, Pound faxed NYDEC the results from the 2000 tests. (Id. ¶ 28; Pl. 3/10/06 Rule 56.1 Stmt. ¶ 28.) The City and NYDEC met on August 28, 2001 to discuss the requirements for approval of the new plan.7 (New Rochelle Rule 56.1 Stmt. ¶¶...
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