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Court Hears Appeal for the Issuance of a Set Off


A Probate Lawyer said in an action to foreclose a materialman’s lien, the appeal is from a judgment of the Supreme Court, Richmond County, dated November 2, 1981, which confirmed the Referee’s decision of July 7, 1981, in favor of the plaintiff and against defendant Corporation in the total amount of $64,112.81.

By order of this court dated September 13, 1982, the appeal was held in abeyance and the matter was remitted to the Supreme Court, Richmond County, with the direction that upon remittitur “Special Term should refer this matter to the Referee for a factual determination with regard to whether defendant is entitled to a ‘set-off’ or credit in the sum of $25,000, thereby reducing the principal amount of the judgment against it to that extent”. The referee’s report on remittitur, dated November 15, 1982, states that Beverly is not entitled to the $25,000 setoff.
A general construction contractor of a residential community located on Staten Island, was a joint venture comprised of defendant and another corporation. Defendant is the representative of the estate, the subcontractor employed under two separate contracts to install the plumbing in those sections of the Village designated as Loop A and Loop B. Plaintiff allegedly delivered materials to Iosue for use at the Village project, and for which it was never compensated. Its lien in the amount of $43,148.88 was timely filed on December 28, 1972. It seeks recovery of that amount from Company.

An Estate Attorney said that the Referee concluded that defendant did not breach the contract and that the Company was indebted to defendant in the amount of $41,483.32, for the unpaid extras. Further, the Referee determined that the lien was valid, and that it could attach to the full amount awarded. However, the Referee’s initial decision did not address the validity of the Company’s claim for a $25,000 setoff against any amount owed.

Accordingly, this court remitted the matter to enable the Referee to make a determination on the issue of the setoff. After conducting a hearing, the Referee concluded that Beverly was not entitled to the requested setoff, since it failed to establish that the $25,000 payment was for noncontractual extras, and not for items covered under the original contract.

In regard to the claim for extras, the law is well settled. It was succinctly stated in a case, where the court held:

“With respect to material furnished a subcontractor by materialmen, liens filed by such materialmen can only be enforced to the extent of money owed by the contractor to the subcontractor.

Consequently, unless the corporation is indebted, there is no fund upon which the lien may attach.

Long Island Probate Lawyers said the Referee was correct in concluding that there was no breach of contract. The record revealed that the corporation’s actions were partially responsible for any delay in completing the contract. In such a situation, the company may not be permitted to assert to its advantage the failure to perform within the time originally allotted. Furthermore, the company failed to establish by a preponderance of the evidence that the breached the contract by abandoning performance thereunder. Thereafter, defendant forwarded a written response indicating that he had supplied additional men and intended to abide by the terms of the contract.

Where the evidence of a party to the action is not contradicted by direct evidence, nor by any legitimate inferences from the evidence, and is not opposed to the probabilities; nor in its nature, surprising or suspicious, there is no reason for denying to it conclusiveness.

We pause to note that the Referee erred in relying on the testimony to establish that Beverly waived any claim of breach by abandonment. The testimony did not establish that the continued to perform pursuant to the Loop B contract, following the aforementioned letter of proposed termination.

Queens Probate Lawyers said the Company’s assertion that defendant failed to prove a prima facie case is meritless. There is no reason to disturb the Referee’s determination that Beverly is indebted in the amount of $41,483.32. Moreover, the company is not entitled to the requested setoff of $25,000, since it failed to sustain its burden of proving that the payment was for noncontractual extras. Inasmuch as defendant did not breach the contract, Beverly may not setoff its alleged damages against the amount owed. Thus, there is a fund upon which defendant’s lien may attach. Moreover, defendant proffered sufficient proof to establish delivery of the materials.

For quality and reliable advice, you can consult our Richmond County Estate Attorneys, who will help you with your predicaments regarding an estate. For other matters, you can also consult our Richmond County Will Contest Lawyers here in Stephen Bilkis and Associates.

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