Please note our NYC address has changed, see the new address in the header or on the contact page of our website.
425 Broadhollow Road
Suite 417
Melville, NY 11747

Freiberger Haber LLP
420 Lexington Avenue
Suite 300
New York, NY 10170


Documentary Evidence, Breach of Contract and Common-Law Indemnification

Print Article
  • Posted on: Jun 24 2020

In Pizzarotti, LLC v. Phipps & Co., 2020 N.Y. Slip Op. 50696(U) (Sup. Ct., N.Y. County June 17, 2020) (here), Justice Gerald Lebovits of the Supreme Court, New York County, recently addressed a number of issues that we often examine, among them, a motion to dismiss on the basis of documentary evidence, breach of contract and common-law indemnification. We examine these issues and Pizzarotti below. 

Dismissal on the Basis of Documentary Evidence

Under CPLR § 3211(a), a party may make a motion to dismiss on the “ground that . . . a defense is founded upon documentary evidence.” The CPLR does not, however, define the phrase “documentary evidence.” For this reason, courts have described the phrase as “fuzzy” because “what is documentary evidence for one purpose, might not be documentary evidence for another.” Fontanetta v. Doe, 73 A.D.3d 78, 84 (2d Dept. 2010).

To qualify as “documentary,” the content of the document must be “essentially undeniable and …, assuming the verity of [the paper] and the validity of its execution, will itself support the ground on which the motion is based.” Amsterdam Hospitality Grp., LLC v. Marshall-Alan Assocs., Inc., 120 A.D.3d 431, 432 (1st Dept. 2014), quoting David D. Siegel, Practice Commentaries, McKinney’s Cons. Laws of N.Y., Book 7B, C.P.L.R. C3211:10 at 22. Materials that clearly qualify as “documentary evidence” include judicial records, such as judgments and orders, as well as documents reflecting out of-court transactions, such as contracts, deeds, wills, and mortgages. Fontanetta, 73 A.D.3d at 84-85 (citation omitted). 

Under CPLR § 3211(a)(1), dismissal is warranted only if the documentary evidence submitted “utterly refutes plaintiff’s factual allegations” (Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326 (2002)), and “conclusively establishes a defense to the asserted claims as a matter of law.” Weil, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 10 A.D.3d 267, 270-71 (1st Dept. 2004). (internal quotation marks omitted). In other words, the documents relied upon must “definitely dispose of [the] plaintiff’s claim.” Blonder & Co. v. Citibank, N.A., 28 A.D.3d 180, 182 (1st Dept. 2006). 

Breach of Contract

The elements of a cause of action for breach of contract are (1) the formation of an agreement, (2) performance of the agreement by one party, (3) breach by the other party, and (4) damages. E.g., Stonehill Capital Mgt., LLC v. Bank of the West, 28 N.Y.3d 439, 448 (2016); Morris v. 702 E. Fifth St. HDFC, 46 A.D.3d 478, 479 (1st Dept. 2007). All the elements must be pleaded to avoid dismissal. See Bonamii v. Straight Arrow Publs., 133 A.D.2d 585 (1st Dept. 1987).

With regard to the first element of a breach of contract claim (i.e., the formation of a contract), the plaintiff must establish an offer, acceptance of the offer, consideration, mutual assent and an intent to be bound. 22 N.Y. Jur. 2d, Contracts Section 9.

“An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.” Restatement (Second) of Contracts § 24. Acceptance of an offer is effective if it clearly, unambiguously and unequivocally complies with the terms of the offer. King v King, 208 A.D.2d 1143, 1143-1144 (3d Dept. 1994) (citing 21 N.Y. Jur. 2d, Contracts § 53 at 470 (1982), and 2 Williston on Contracts § 6:10 at 68 (4th ed. 1990)).

“[T]o constitute consideration, a performance or a return promise must be bargained for.” See Restatement (Second) of Contracts §71. Thus, the plaintiff must demonstrate some performance or a return promise that was bargained for by the defendant’s promise to fulfill the terms of the agreement. Kolchins v. Evolution Markets, Inc., 128 A.D.3d 47, 59-60 (1st Dept. 2015).

Mutual assent requires an agreement as to the essential terms and conditions of the agreement, and intent to be bound requires that such assent be sufficiently definite to assure that the parties are truly in agreement with respect to all material terms. Joseph Martin, Jr., Delicatessen v. Schumacher, 52 N.Y.2d 105, 109 (1981); Matter of Express Indus. & Term. Corp. v. New York State Dept. of Transp., 93 N.Y.2d 584, 589 (1999). A “mere agreement to agree, in which a material term is left for future negotiations, is unenforceable.” Joseph Martin, Jr., Delicatessen, 52 N.Y.2d at 109. If the alleged contract “is not reasonably certain in its material terms, there can be no legally enforceable contract.” Edelman v. Poster, 72 A.D.3d 182, 184 (1st Dept. 2010). In addition, under the doctrine of definiteness, the court must be able to determine what, in fact, the parties agreed to in order to enforce a contract. Matter of 166 Mamaroneck Ave. Corp. v. 151 E. Post Rd. Corp., 78 N.Y.2d 88, 91 (1991); Korff v. Corbett, 18 A.D.3d 248, 250 (1st Dept. 2005) (agreement language indicated meeting of minds, refers to consideration, specifies amount clearly agreed to).

Common-Law Indemnification

In the “classic indemnification case,” the one seeking indemnification “had committed no wrong, but by virtue of some relationship with the tort-feasor or obligation imposed by law, was nevertheless held liable to the injured party.” D’Ambrosio v. City of New York, 55 N.Y.2d 454, 461 (1982); Trustees of Columbia Univ. in City of N.Y. v. Mitchell/Giurgola Assoc., 109 A.D.2d 449, 451 (1st Dept. 1985). Thus, “where one is held liable solely on account of the negligence of another, indemnification, not contribution, principles apply to shift the entire liability to the one who was negligent.” D’Ambrosio, 55 N.Y.2d at 462.

Indemnification “may be based upon an express contract,” though it is “more commonly” implied “based upon the law’s notion of what is fair and proper as between the parties.” Mas v. Two Bridges Assocs., 75 N.Y.2d 680, 690 (1990) (internal citations omitted). “[T]he key element of a common-law cause of action for indemnification is not a duty running from the indemnitor to the injured party, but rather is a separate duty owed the indenmitee by the indemnitor. The duty that forms the basis for the liability arises from the principle that everyone is responsible for the consequences of his own negligence, and if another person has been compelled to pay the damages which ought to have been paid by the wrongdoer, they may be recovered from him.” Raquet v. Braun, 90 N.Y.2d 177, 183 (1997) (internal quotation marks, citations, and ellipsis omitted.)

Pizzarotti, LLC v. Phipps & Co.


Pizzarotti arose from a dispute relating to an April 2018 construction contract between plaintiff, Pizzarotti LLC (“Pizzarotti”), as construction manager and defendant, Phipps & Co. (“Phipps”), as contractor. 

Plaintiff contracted with Phipps to perform stone and tile work for the One Seaport Project in Manhattan. The total contract price was $2,142,417.54. Under the contract, Pizzarotti agreed to provide Phipps with an advance payment to cover the costs of purchasing materials, as long as Phipps provided a letter of credit to assure Pizzarotti that Phipps had the assets to repay the advance. Phipps could not provide that assurance and requested that Pizzarotti accept a letter of credit from defendant, SG Blocks, Inc. (“SG Blocks”). Plaintiff agreed. At the contract signing, Phipps further requested that the material-supply portion of the contract be assigned to SG Blocks. Plaintiff again agreed but requested that the assignment be reduced to writing.

On May 30, 2018, the parties executed an assignment agreement. Under the agreement, SG Blocks agreed to supply the materials needed for the project and to provide a letter of credit to secure an advance payment from plaintiff. Phipps agreed to remain jointly and severally liable with SG Blocks for the performance of the contract’s supply obligations. Those obligations comprised $1,385,000 – nearly two-thirds of the contract’s total value. Plaintiff agreed to make payments through two-party checks made out to both Phipps and SG Blocks. 

Plaintiff alleged that on June 5, it received assurances that SG Blocks’ bank would release a letter of credit, and therefore transferred an advance payment of $500,000 to SG Blocks and Phipps. In the weeks that followed, however, plaintiff repeatedly, but unsuccessfully, attempted to contact SG Blocks and Phipps to obtain the promised letter of credit and urged the parties to begin working on the project (or obtain proof that they had done so). 

On June 22, Phipps informed Pizzarotti’s general counsel that “[a]s far as SG Blocks, it is unlikely we will be able to execute this contract together.” SG Blocks agreed and requested to be removed from future communications between the parties. In response, plaintiff continued to request that Phipps and SG Blocks fulfill the contract. On July 6, however, Phipps sent an email arguing that the contract was never in effect. On July 24, plaintiff sent Phipps and SG Blocks a notice to cure, giving them three business days to begin work and provide a letter of credit. Phipps and SG Blocks declined to do so. Plaintiff ultimately terminated the contract and assignment for cause on August 23, 2018. 

In August 2018, Pizzarotti sued Phipps and SG Blocks for failing to perform under the contract. Phipps later cross-claimed against SG Blocks. 

As against SG Blocks, plaintiff asserted a claim for breach of contract (for failing to perform its obligations under the assignment agreement) and a claim for trust diversion (for using the $500,000 advance payment for purposes other than performing work under the contract). Phipps counter-claimed against plaintiff. Phipps also cross-claimed against SG Blocks for (i) indemnity; (ii) common law contribution; (iii) fraud; (iv) negligence; (v) negligent misrepresentation, and (vi) breach of contract. 

SG Blocks moved to dismiss both plaintiff’s amended complaint and Phipps’ cross-claims under CPLR § 3211 (a) (1) and CPLR § 3211 (a) (7). 

The Court denied SG Blocks’ motion to dismiss plaintiff’s complaint but granted in part and denied in part the motion seeking dismissal of the cross-claims.

The Court’s Decision

A. Dismissal under CPLR § 3211 (a) (1)

SG Blocks argued that the assignment agreement refuted plaintiff’s claims. SG Blocks asserted that the agreement did not identify consideration for SG Blocks’ alleged obligations under the agreement, thereby rendering the contract a nullity. In particular, SG Blocks argued that plaintiff and Phipps did not promise to pay SG Blocks for its obligation to provide supplies for the project, and therefore the assignment agreement lacked a mutuality of obligation. The court disagreed.

The Court noted that the assignment agreement provided that all payments for the materials and supplies were to be made by two-party checks payable both to Phipps and SG Blocks. Slip Op. at *2. The Court further noted that, “consistent with the agreement,” “plaintiff issued a check for $500,000,” naming “both Phipps and SG Blocks as joint payees.” Id. The Court held that “[t]his exchange of something of value support[ed] the existence of adequate consideration.” Id. (citing Apfel v. Prudential-Bache Sec., Inc., 81 N.Y.2d 470, 476 (1993).

The Court rejected SG Blocks contention “that for consideration to exist, plaintiff would have had to take additional steps to ‘ensure[] that a certain portion of the monies due under the Pizzarotti-Phipps Contract would be owed and payable to SG Blocks.’” Id. The Court found that SG Blocks failed to provide any “authority supporting this proposition.” Id. The Court said that “even absent additional action by plaintiff, SG Blocks would have enforceable legal rights in checks issued by plaintiff under the contract to both Phipps and SG Blocks as joint payees – such as, for example, the $500,000 advance payment.” Id. at *2-*3. “Most pertinently,” explained the Court, “since a check is a negotiable instrument, SG Blocks’s endorsement would be required before a check from plaintiff to Phipps and SG Blocks jointly could be deposited with a bank.” Id. at *3 (citing Kryten Iron Works, Inc. v. Ultra-Tech Fabricators, Inc., 228 A.D.2d 416, 416 (2d Dept. 1996). Thus, concluded the Court, “Phipps would have no legal right to make off with the check and take the full amount for itself.” Id.

“Moreover,” observed the Court, “SG Blocks’s conduct before the execution of the assignment agreement indicate[d] that SG Blocks understood that plaintiff would have an obligation to pay for the work that SG Blocks undertook – including preparing financial documents premised on SG Blocks making a profit on the supply portion of the contract.” Id. “At a minimum,” concluded the Court, “the assignment agreement standing alone [did] not definitively refute plaintiff’s claims against SG Blocks, as required for dismissal under CPLR 3211 (a) (1).” Id.

B. SG Blocks’ Motion to Dismiss Plaintiff’s Contract Claim

The Court held that the complaint, taken as true, stated a cause of action for breach of contract. First, as discussed above, the Court found that the assignment agreement identified the consideration for SG Blocks’ obligations to provide materials for the project. Id. 

Second, the Court held that the complaint stated a cause of action to recover damages for trust diversion. Id. The Court explained that since the assignment agreement incorporated the terms of the contract (which provided in pertinent part that all funds paid to Phipps constituted trust funds to be used for purposes outlined in the contract), SG Blocks was “bound to use the advance payment of $500,000 for contractual purposes.” Id. Given plaintiff’s allegation that the $500,000 was not used for this intended purpose, plaintiff stated a claim for trust-diversion. Id.

C. SG Blocks’ Motion to Dismiss Phipps’ Cross-Claims

The Court held that Phipps’ cross-claim for common-law indemnification did not state a cause of action. Slip Op. at *4. Phipps argued that by executing the assignment agreement, SG Blocks agreed to indemnify them for “the full amount of culpability of any judgment that might be rendered against Phipps in the original action.” Id. However, “[s]ince the predicate of common-law indemnity is vicarious liability without actual fault on the part of the proposed indemnitee, it follow[ed] that a party who has itself actually participated to some degree in the wrongdoing cannot receive the benefit of the doctrine.” Id. (quoting Trustees of Columbia Univ. v. Mitchell/Giurgola Assoc., 109 A.D.2d 449, 453 (1st Dept. 1985). Phipps’ liability in the main action, said the Court, would be primary not secondary. Id. Its liability “would flow instead from Phipps’s alleged failure to perform its own contractual obligations under the contract and the assignment agreement.” Id. Therefore, Phipps could “not receive the benefit of common-law indemnity.” Id.

The Court held that Phipps’ cross-claim for common-law contribution also failed. Id. “Contribution is not available where the liability upon which the contribution claim is based derives solely from breach of contract.” Id. (citing Bd. of Educ. of Hudson City Sch. Dist. v. Sargent, Webster, Crenshaw & Folley, 71 NY2d 21, 28 [1987].) “Here,” said the Court, “the potential liability of both Phipps and SG Blocks to plaintiff is for economic loss resulting from an alleged breach of contract. Common-law contribution is not available.”


CPLR § 3211(a)(1) can be a powerful tool to secure dismissal of a complaint. While not every document will demonstrate the absence of a cause of action, where the document is clear, unambiguous, and undeniable, and “utterly refutes” the claims asserted, dismissal is appropriate. In Pizzarotti, the assignment agreement did not “utterly refute” plaintiff’s breach of contract claim.

In claiming a breach of contract (i.e., enforcing or attempting to enforce a contract), a plaintiff must plead the existence of a valid contract. In that regard, the plaintiff must demonstrate that the parties created a contract. Pizzarotti highlights this issue.

The principle of common law, or implied, indemnification permits one who has been compelled to pay for the wrong of another to recover from the wrongdoer the damages it paid to the injured party. The party seeking indemnification must have delegated exclusive responsibility for the duties giving rise to the loss to the party from whom indemnification is sought and must not have committed actual wrongdoing itself. In Pizzarotti, the Court found that the doctrine did not apply because Phipps was alleged to be the actual wrongdoer.

Freiberger Haber LLP Footer Logo
Copyright ©2022 Freiberger Haber LLP | Disclaimer
Attorney advertisement | Prior results do not guarantee a similar outcome.
425 Broadhollow Road, Suite 417, Melville, NY 11747 | (631) 282-8985
420 Lexington Avenue, Suite 300, New York, NY 10017 | (212) 209-1005
Attorney Website by Zola Creative