How Our Firm Successfully Opposed a Motion for Summary Judgment:

In today’s business landscape, many small companies face significant financial challenges, particularly when it comes to securing necessary capital. This financial pressure has given rise to Merchant Cash Advances (MCAs), which are often marketed as quick liquidity solutions for businesses in need. However, not all MCAs are what they appear to be, and some, as our recent case demonstrates, cross the line into predatory lending.

In this recent case, we had the privilege of representing Suburban Waste Services, Inc., owned by Mr. David Dienno and Ms. Christina Bizzari, against claims brought by Kapitus Servicing, Inc. The lawsuit revolved around two Revenue-Based Factoring Agreements, where Kapitus alleged that our client had defaulted on their obligations, leading to a demand for over $353,000, including fees for breach of contract and returned payments.

Case Analysis:

Implied Covenant of Good Faith in Business Contracts Introduction The New York Court of Appeals recently ruled on a significant business law case, Singh v. City of New York (2023), which holds important lessons for contract law, particularly regarding the implied covenant of good faith and fair dealing. This decision highlights the limitations of this covenant when clear contractual disclaimers are in place. Overview of the Case The case revolved around the claim by taxi medallion owners that New York City devalued their medallions by allowing ride-sharing services like Uber and Lyft to operate without stringent regulation. Plaintiffs argued that this undermined the implicit guarantee of good faith and fair dealing tied to the original contracts for medallion purchases. However, the Court ruled against the plaintiffs, citing that the bid forms the medallion owners signed contained disclaimers, expressly stating that the city made no warranties about the medallions’ future value. These disclaimers negated any implied promises of maintaining medallion value post-purchase. Key Takeaways for Business Owners • Implied Covenant of Good Faith: While New York law generally implies a covenant of good faith and fair dealing in contracts, it cannot override explicit disclaimers within an agreement. • Contractual Disclaimers Matter: Business contracts should be carefully reviewed for disclaimers, especially when dealing with government entities or public assets like medallions