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SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF NEW YORK: IAS PART 47

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WINDFIELD

Index No .
602693/01

SECURITY CORPORATION
Plaintiff,

DECISION AND ORDER

-againstSAVEY SENIOR ROUSING CORPORATION


SAVEY LITTLE NECK ASSOCIATES, L P
SAVEY BORO PAR K ASSOCIATES, L.P.
Defendant.

an

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PAULA J. OMANSKY, J. :
Defendants move for leave to reargue and plaintiff cross
moves for leave to reargue the decision and order of this
court dated June 27, 2002.

The attorneys defending

plaintiff on the counterclaim have subroitt2d opposition t o


defendants' motion.
This action arises out of security services rendered by
plaintiff Winf ield Security Corporation ("Winfield") to
defendants, Savoy Senior Housing Corporation, which manages the
operations of co-defendants Savory Boro Park Associates Limited
Partnership

("Boro Park") and Savoy Little Neck Associates

Limited Partnership

("Little Neck"), b o t h elder care

facilities.
This court is in agreement with both sides that its prior
order requires modification and clarification.
motion and cross-motion

Accordingly, the

for leave to reargue is granted and

upon

reargument the prior order is otherwise adhered to except to the


extent specifically indicated otherwise, and to that extent, the
prior order is vacated

and

recalled.

LITTLE NECK
With respect to Little Neck, there was an executed
written agreement-between the parties

in which Winfield was

to provide security guards at the rate of $14 per security


officer hour
worked.

The agreement at paragraph

clause which

7 contained an

limited Winfield' s liability

exculpatory

for loss of property to

$250 and which stated:


the Agency is not a property insurer
...that the Agency being paid hereunder for a
guard system intended to deter certain
risks of loss and that all amounts being
charged
hereunder by the agency are not sufficient to
guarantee that no loss will occur; the Agency
makes no warranty or guarantee that the
services supplied will avert or prevent
occurrences ...
Defendants argue that this written agreement is unenforceable as
it is not in conformity with 19 NYCCR 173. 1 1 applicable to
security agreements.

While the subject agreement fails to set

out the time limit for the services to be provided as required


by Section 173.l(a ) , said violation does not render the
contract unenforceable.

In the case of Wowaka & Sons, Inc. v

Pardell, 242
A. D.2d

1 ( 2nd Dept 1998), the court found that a written home

improvement contract not in strict compliance with General


Business Law article 36-A, but otherwise containing material
terms, is not per se unenforceable so as to bar the contractor
from suing on the contract . Additionally, there is authority
holding that a violation of the subject regulation is merely

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m a l u m prohibitum and does not expressly deprive a party of its


right to sue on contract ( J o e O' Brien Investigations v Zorn , 2 63
A. 0.2d 812 [3rd Dept 19991)

Therefore, contrary to defendants'

position, plaintiff is not limited to a claim for quantum meruit .


As

to the counterclaim asserted by Little Neck,

claimed that Winfield


security personnel

it

breached its agreement to provide

and that it was negligent

is
competent

in the supervision

and training of its guards alleging acts of theft arid

vandalism.

This court' s prior order dismissed this counterclaim finding

that

the exculpatory clause barred any claim for theft and that the
other branch of the counterclaim for breach of contract was
dismissed

for insufficiency.

This court adheres to its prior order dismissing


counterclaim.

In fact, this court finds that the

the

exculpatory

clause is broad enough to limit damages whether or not the claim

is for breach of contract or for

negligence.

The agreement

evinced the intent that the customer l o o k solely to its insurance


company

to protect

Inc., 256 A .D . 2d

its premises

(Straus s v Stoneledge Far m,

118 6 [ 4 c t, Dept 19981) ,

Also, even if the exculpatory clause is not applicable to


defendants' breach of contract claim that the performance of
the guards was substandard, defendants' counterclaim, as
previously stated, is insufficient. Defendants ' position that
they need discovery on the issue of whether the security
services provided

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were within industry standards lacks merit . A party is not


entitled to discovery in order to investigate and determine
whether

it has a valid cause of

action.

As to the affirmative defense, which contains the same


allegations as the dismissed

counterclaim,

it should be stricken for the same


to recovery

reasons.

this court finds that


Winfield

is entitled

for its services as provided in the contract

since

this court has already found that there is no evidence that the
services were

substandard.

Accordingly, with respect to Little Neck, defendants '


counterclaim is dismissed and affirmative defense is stricken
and Winfield is granted partial summary judgment on the issue of
liability with respect to its cause of action for breach of
contract and this matter shall be set down for an assessment of
damages .
BORO PARK

With respect to Boro Park, this court also adheres to its


prior order

denying Winfield' s motion

to dismiss the

counterclaim.
This court in its prior order denied summary judgment to
Winfield on its cause of action for an account stated finding
that defendants had offered evidence of contemporaneous protest
. This court also found the counterclaim alleging a specific
incident in which $10,000 worth of plumbing supplies was stolen,

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in the presence of the guards, sufficiently stated a claim for


substandard services .
Winfield argues that the counterclaim should be dismissed
and the affirmative defense stricken on the ground

that

defendants' payment of the invoices for the shifts during which


the theft occurred, constitutes a waiver and est0ppel.

A waiver

is a voluntary and intentional abandonment of a known right


which, but for the waiver, would have been enforceable.
Defendants payment for security services is not evident of a
voluntary and intentional abandonment of their right to seek
property damages at a later date.
Therefore, while Winfield may be entitled to partial
summary on its cause of action for quantum meruit, any
determination as to the reasonable value of those services must
await the underlying trial of defendant' s counterclaim,
including the claim
of theft and unauthorized telephone use, and affirmative defense .

Accordingly, it is
ORDERED that plaintiff' s motion for partial summary
judgment on the issue of liability with respect to Little Neck
on its cause of action for breach of contract is granted, and
that the counterclaim is dismissed and the affirmative answer is
8tricken

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and an assessment of damages against the defendants as to Little


Neck is directed, and it is

further

ORDERED that the issue of damages, with respect to

Little

Neck 's breach of contract cause of action, is referred to a


Special Referee to hear and report with recommendations, except
that, in the event of and upon the filing of a stipulation of
the parties, as permitted by CPLR 4317, the Special Referee, ;
another person designated by the parties to serve as referee,
shall determine the aforesaid issue; and it further
ORDERED that this

motion is held in abeyance pending

receipt

of the report and recommendations of the Special Referee and a


motion pursuant to CPLF 4403 or receipt of the determinations of
the Special Referee or the designated referee; and it is
ORDERED that a copy of this order with notice of entry
be served on the Clerk of the Judicial Support office

further
shall

(Room 311)

to arrange a date for the reference to a Special Referee; and it


is further
ORDERED that the plaintiff 's motion for summary judgment
dismissing the counterclaim and striking the affirmative defense
w i t h respect to Boro Park is d e n i e d . and it is further

ORDERED that plaintiff 's motionfor partial summary


judgment on the issue of liability with respect to Boro Park on
its cause of action for q uantu m m e r u it is granted, however,
any assessment as to the reasonable value of the services
rend8red is he ::.d

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abeyance pending the trial of defendants' counterclaim


and affirmative defense; and it is further
ORDERED that the parties are directed to appear for a
conference on Feb. 7, 2003 at 11 a.m. at 71 Thomas Street,
Room 205, New York, N.Y.
DATED:

Feb 3, 2003
PAULA
J.
OMANS
KY
J.S.C