Summary
affirming dismissal of claim for unjust enrichment because of the existence of a valid contract governing the subject matter of the parties' dispute
Summary of this case from GEM ADVISORS, INC. v. INVU, INC.Opinion
February 2, 1999
Appeal from the Supreme Court, New York County (Herman Cahn, J.).
The parties' clear and unambiguous contract created an arms length licensor/licensee relationship, pursuant to which defendant was obligated to remit to plaintiffs a percentage of royalties it collected from third-party licensees on a quarterly basis. Nothing in the language of the agreement or the parties' course of conduct, as alleged, during the agreement's initial three-year term and three subsequent, successive one-year extensions, may be understood as having placed limitations upon defendant's disposition of collected royalties prior to defendant's timely remittal to plaintiffs of the share of such royalties to which plaintiffs were entitled pursuant to the parties' agreement. Nor is there any basis in the contract or the parties' conduct to infer an obligation to pay plaintiffs interest on collected royalties. Absent ambiguity, the unequivocal language of the parties' contract controls ( see, Matter of Wallace v. 600 Partners Co., 86 N.Y.2d 543, 548; W.W.W. Assocs. v. Giancontieri, 77 N.Y.2d 157, 162), and plaintiffs having, pursuant to that contract, had no right to possession of, or other legal interest in, the royalties funds prior to the date upon which their remittance was due, can derive no benefit from the maxim that interest follows principal ( compare, e.g., Phillips v. Washington Legal Found., 524 U.S. 156; Stuarco, Inc. v. Slafbro Realty Corp., 30 A.D.2d 80, lv denied 22 N.Y.2d 645).
The fourth cause of action alleging unjust enrichment, was also properly dismissed, since where, as here, there is a valid contract governing the subject matter of the parties' dispute, recovery in quasi contract for events arising out of that same subject matter is precluded ( Clark-Fitzpatrick, Inc. v. Long Is. R. R. Co., 70 N.Y.2d 382, 388). The fifth cause of action, purporting to allege a breach of fiduciary duty based upon the use of the terms "principal" and "agent" in the parties' agreement was properly dismissed as well. The parties' agreement, premised as it was upon a conventional business relationship and establishing at arm's length no more than routine licensing and royalties rights and obligations, did not implicate or give rise to a fiduciary relationship ( see, Feigen v. Advance Capital Mgt. Corp., 150 A.D.2d 281, 283, lv denied 74 N.Y.2d 874; Payrolls Tabulating v. Sperry Rand Corp., 22 A.D.2d 595, 598; Donnelley Corp. v. Mark I Mktg. Corp., 893 F. Supp. 285, 289; see also, Liebowitz v. Elsevier Science, 927 F. Supp. 688, 711; Lane v. Mercury Record Corp., 21 A.D.2d 602, 603, affd 18 N.Y.2d 889).
Concur — Nardelli, J. P., Lerner, Mazzarelli and Saxe, JJ.