

Grewal v DHL Express (USA), Inc. (2017 NY Slip Op 02737)





Grewal v DHL Express (USA), Inc.


2017 NY Slip Op 02737


Decided on April 6, 2017


Appellate Division, First Department


Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.


This opinion is uncorrected and subject to revision before publication in the Official Reports.



Decided on April 6, 2017

Renwick, J.P., Mazzarelli, Manzanet-Daniels, Feinman, Webber, JJ.


600112/09 3653A 3653

[*1] Bhupinder Grewal, doing business as United Shipping Solutions, et al., Plaintiffs-Appellants, Shero Shipping, LLC doing business as United Shipping Solutions, et al., Plaintiffs-Intervenors-Appellants,
vDHL Express (USA), Inc., Defendant-Respondent.


K & L Gates LLP, New York (John C. Blessington of the bar of the Commonwealth of Massachusetts and State of Maine, admitted pro hac vice, of counsel), for Bhupinder Grewal, Shipping Solutions, Bryan Smetanka, Buckley Shipping and Frieght, Inc., Clever Goods, LLC, Cold Spring Investments, LLC, Cold Spring Investments, No. 1, Limited Partnership, Cold Spring Investments, No. 2, Limited Partnership, Diamond Mountain Holdings, LLC, Elite Logistics, Inc., Extreme Group, Inc., First Coast Shipping, LLC, Global Express Shipping, Inc, Hannah Enterprises, Inc, Mariposa Express, Inc, Metro Mar Ventures, LLC, Michael Jones, LLC, Michaelson Ventures Inc, M.K. Logistics Management, LLC, OLS LLC, Outforce, LLC, Premier Solutions Logistics, LLC, Shermanator Inc., Stirling LLC, The Double A & O Group, Inc., Timothy Salavejus,
4O Enterprises, United Shipping Solutions, LLC, USS Boston Inc., USS Charlotte Inc., USS Essex Inc., USS Highland Park, Inc., USS Holdings, LLC, USS O'Brien, Inc., USS Raleigh Inc., USS SanDiego, CA, Inc., and Wiley & Company, LLC, appellants.
Davidoff Hutcher & Citron LLP, New York (Robert J. Lewis of counsel), for Shero Shipping, LLC, KuK Logistics, MNS, LLC,
KuK Logistics MNO, LLC, and KuK Logistics SS, LLC, appellants.
Dechert LLP, Los Angeles, CA (Christopher S. Ruhland of the bar of the State of California, admitted pro hac vice, of counsel), for respondent.

Amended judgment, Supreme Court, New York County (Eileen Bransten, J.), entered February 3, 2016, which brings up for review orders, same court and Justice, entered February 15, 2012, which denied plaintiffs' motion and plaintiffs-intervenors' cross motion for summary judgment, and entered September 30, 2015, which denied plaintiffs' and plaintiffs intervenors' motions pursuant to CPLR 4404(a) to set aside the verdict and direct judgment as a matter of law or order a new trial, unanimously affirmed, without costs. Appeal from judgment, entered February 1, 2016, unanimously dismissed, without costs, as superseded by the appeal from the amended judgment.
Defendant, a global shipping company that sells its services to "resellers" that negotiate shipping rates with it and then resell the shipping services to their customers at higher rates, entered into a Reseller Agreement with USS Logistics (Logistics) in January 2003. Plaintiffs and plaintiffs intervenors (collectively plaintiffs) are franchisees of an affiliate of Logistics. They commenced this action against defendant alleging, inter alia, breach of contract after defendant discontinued domestic shipping service prior to the expiration of its reseller agreement with Logistics.
The sole issue on this appeal is plaintiffs are third-party beneficiaries of the reseller agreement between defendant and Logistics. The case was tried to a jury which returned a verdict determining that they were not. Plaintiffs argue that the relevant provision of an amendment to the reseller agreement was unambiguous, requiring a determination that they were third-party beneficiaries as a matter of law and because the language of the amendment was determinative, the jury's conclusion otherwise was irrational. Other than arguing that the language of the amendment was determinative, they do not raise any argument regarding the evidence presented to the jury or the jury's interpretation of it.
Contrary to plaintiffs' contention, Supreme Court correctly concluded that the provision at issue was ambiguous on the issue of whether they were third-party beneficiaries of the reseller agreement. In any event, pursuant to California law, which governed the reseller agreement, "[i]n determining the meaning of a written contract allegedly made, in part, for the benefit of a third party, evidence of the circumstances and negotiations of the parties in making the contract is both relevant and admissible. And, in the absence of grounds for estoppel, the contracting parties should be allowed to testify as to their actual intention" (Garcia v Truck Ins. Exch., 36 Cal 3d 426, 437 [Cal 1984] [citation and internal quotation marks omitted]; see Spinks v Equity Residential Briarwood Apts., 171 Cal App 4th 1004, 1024 [Cal Ct App 2009]). Accordingly, the issue was properly submitted to a jury for resolution based on the evidence offered at trial. Because plaintiffs do not raise any argument with regard to the evidence or the jury's interpretation of it, other than to argue that the language of the amendment was determinative, they are not entitled to a new trial.
Further, under Utah law, a jury verdict on the issue in a Utah action involving defendant and other franchisees, which settled and was dismissed with prejudice before the verdict was reduced to final judgment does not collaterally estop defendant (Richardson v Navistar Intl. Transp. Corp., 8 P3d 263, 265 [Utah 2000]; see Bruno v Bruno, 83 AD3d 165, 169 [1st Dept 2011], lv denied 18 NY3d 805 [2012]; see also Peterson v Forkey, 50 AD2d 774, 774-775 [1st Dept 1975]).
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
ENTERED: APRIL 6, 2017
CLERK


