Summary Judgment Denied Where Plaintiff’s Demand Conflicted with Parties’ Course of Dealing and Express Terms of Contract

On May 23, 2023, Justice Andrew Borrok of the New York County Commercial Division issued a decision in GalaxE.Healthcare Sols., Inc. v. RxSense, LLC, 2023 N.Y. Misc. LEXIS 2568. The Court denied the plaintiff’s motion for summary judgment, finding that the plaintiff’s claim was contradicted by the parties’ prior course of dealing and the express terms of the parties’ agreement. The Court explained:

The plaintiff's motion (Mtn. Seq. No. 011) for summary judgment must be denied. As discussed more completely on the record (5.23.23), the fully developed record before the Court firmly establishes that the parties worked iteratively on the development of the code and that the plaintiff unilaterally demanded "immediate payment" of a June 25, 2019 invoice (the June Invoice) and then walked off the job - neither of which it was not entitled to do under the Information Technology Services Agreement (the ITSA; NYSCEF Doc. No. 137), dated June 7, 2018. Putting aside that the record establishes a course of dealing pursuant to which invoices were paid over time and within a reasonable period of time, the idea of "on demand" and "immediate termination" are antithetical to the course of conduct and the express provisions of the ITSA which only permitted the plaintiff to suspend services after 45 days following non-payment had elapsed which in fact it did not (see Section 6.3 of the ITSA).

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning a motion for summary judgment, breach of contract claims, or arguments regarding the parties’ course of conduct.