Globe Storage & Moving Co., Inc. v. Counsel Financial II, LLC
Attorneys and Parties
Brief Summary
Storage and secured lending in a bankruptcy context; whether a storage company can pursue quasi-contract (quantum meruit and unjust enrichment) for holding assets when there is no direct contract but access was granted by a Bankruptcy Court stipulation.
Denied dismissal of the quasi-contract claims and (on the record) dismissed the account-stated claim, although the written order mistakenly referenced dismissal of a non-existent breach-of-contract claim.
The written order’s dismissal of a breach-of-contract claim was struck and replaced with dismissal of the account-stated claim; the remainder (denial of dismissal of the quasi-contract claims) was affirmed.
A Bankruptcy Court stipulation and order created a relationship sufficient to allege reliance/inducement supporting quasi-contract; defendant’s silence and an email acknowledging acquisition of the storage unit plausibly implied benefit and inducement. Factual issues about defendant’s delay and plaintiff’s mitigation precluded dismissal at the pleading stage. The record showed there was no breach-of-contract cause of action and that the court had dismissed the account-stated claim.
Background
Plaintiff, a storage company, held assets of a nonparty bankrupt debtor. A Bankruptcy Court stipulation and order gave defendant, a secured creditor, access to plaintiff’s facility to enforce its secured claim. Plaintiff alleges defendant benefitted from the storage of the assets and remained silent after receiving the stipulation and order, implying ownership/control; defendant also emailed that it had acquired the storage unit containing the debtor’s assets. Plaintiff sued for quantum meruit, unjust enrichment, and account stated. Defendant moved to dismiss.
Lower Court Decision
The Supreme Court, New York County, denied defendant’s motion to dismiss the quasi-contract claims. On the record, it dismissed the account-stated claim, but the written order erroneously stated that a breach-of-contract claim (which was not pled) was dismissed.
Appellate Division Reversal
Modified to correct the clerical error by striking the reference to dismissal of a breach-of-contract claim and substituting dismissal of the account-stated claim; otherwise affirmed the denial of the motion to dismiss the quasi-contract claims.
Legal Significance
Confirms that a relationship arising from a Bankruptcy Court stipulation can supply the reliance/inducement necessary to plead quasi-contract against a secured creditor, even absent a direct contract. Also illustrates that silence and acknowledgments can imply acceptance of benefits sufficient to survive a motion to dismiss, and that appellate courts will conform a written order to the oral ruling.
Even without a direct contract, a storage provider may pursue quantum meruit and unjust enrichment where a bankruptcy stipulation and the creditor’s conduct create a relationship suggesting inducement and benefit; account stated did not survive, and the appellate court corrected the written order to match the transcript.