April 4, 2005

In the Matter of a Mail Dispute Between

 

MARTIN FRANCIS INTERNATIONAL ASSOCIATES, INC.

and

YALE FACTORS, INC.

P.S. Docket No.  MD 05-7

 

APPEARANCE FOR DISPUTANT MARTIN FRANCIS INTERNATIONAL ASSOCIATES, INC.:

George F. A. Parnell, Esq.
Holland & Knight LLP
195 Broadway, 24th Floor
New York, NY  10007-3190

APPEARANCE FOR DISPUTANT YALE FACTORS, INC.:

Morris M. Abolafia, Esq.
39 W. 37th Street, 10th Floor
New York, NY  10018-6217

INITIAL DECISION

            This mail dispute has been docketed pursuant to Postal Operations Manual (POM 9, July 2002) Section 616.21, which requires the Chief Field Counsel to forward certain unresolved mail disputes to the Judicial Officer for resolution.  The mail in dispute is that addressed to Martin Francis International Associates, Inc., at 150 Broadway, Suite 1717, New York, NY 10038-4319.  The New York City Postmaster is currently holding the mail.

Both parties filed sworn written statements, as required by the Rules of Practice, 39 C.F.R. §965.5, along with other documents.  Martin Francis International also filed additional material in rebuttal, in accordance with 39 C.F.R. §965.6.  The following findings of fact are based on all the material submitted by the parties, including the material forwarded by the United States Postal Service Law Department, New York Metro Office.

FINDINGS OF FACT

            1.  On January 22, 2004, the two parties, Martin Francis International Associates, Inc., as “Seller,” and Yale Factors, Inc., as “Purchaser,” entered into a Factoring and Security Agreement.  (Agreement attached to Law Department forwarding letter; also attached to David Schlesinger (Yale) statement, February 12, 2005 submission, as Ex. A).

            2.  Section 8.1 of the Agreement authorizes Purchaser to exercise certain listed powers at any time “until all of the Obligations have been paid in full.” Among the listed powers is to “change the address for delivery of mail to Seller and to receive and open mail addressed to Seller.”

            3.  Section 16 of the Agreement provides that the term of the Agreement shall be two years and that it shall be automatically renewed for an additional two years unless Seller gives Purchaser sixty days written notice of intent to terminate at the end of the term.  This Section also provides that Seller may terminate at any time on thirty days written notice if Seller prepays all existing Obligations and other specified fees.

            4.  On November 9, 2004, Martin Francis’ President sent a letter to Yale, stating that based on improper actions by Yale, “Martin Francis hereby tenders its notice of termination of the Factoring and Security Agreement.”  The letter asked Yale for a “current statement of accounts.”  (Yale February 12, 2005 submission, Ex. B).

            5.  The parties are litigating their rights and obligations in the New York State Supreme Court, New York County.  In connection with that lawsuit, the parties signed a Stipulation, by which Martin Francis agreed to forward “all monies received by Martin Francis on accounts purchased by Yale,” to Yale.  (Schlesinger statement; Parnell January 5, 2005 letter to post office, attached to Law Department forwarding letter; copy of Stipulation attached to Abolafia January 18, 2005 memo to post office).

            6.  This mail dispute arose when Yale asked that mail addressed to Martin Francis International Associates, Inc., be delivered to Yale at 39 West 37th Street, New York City, and Martin Francis protested, asking that the mail be delivered as addressed, to 150 Broadway, Suite 1717.

DECISION

            Martin Francis argues that the disputed mail includes many things that are not related to its Agreement with Yale, but are important to other aspects of Martin Francis’ business.  Martin Francis contends that the Agreement with Yale has properly been terminated and that Yale no longer has any claim to the disputed mail. Martin Francis expresses recognition of its obligation to forward to Yale certain monies that may be contained in the mail.  Therefore, Martin Francis argues that there will be no harm to Yale if Martin Francis receives the mail, but that the reverse is not necessarily true.

            Yale contends that the purported termination letter from Martin Francis is ineffective because Martin Francis’ financial obligations under the Agreement have not been satisfied.  Yale argues that, under the provisions of Section 8.1 of the Agreement, Yale has the right to direct delivery of the disputed mail and this right was not extinguished by the November 9, 2004 letter.

            Yale’s argument is more persuasive.  Clearly, Section 8.1 of the Agreement gave Yale the authority to direct delivery of Martin Francis’ mail, and the Agreement was to run at least to January 2006, unless terminated earlier by Martin Francis in accordance with Section 16.2 of the Agreement.  Martin Francis stated that its termination was based on breaches by Yale, but Martin Francis has not submitted convincing evidence that a breach has occurred or that all the payments contemplated by Section 16.2 have been made.  The Stipulation entered into between the parties (see Finding #5) suggests that all payments from Martin Francis to Yale have not yet been made.  Based on the evidence of record, therefore, Yale still has authority under Section 8.1 of the Agreement to direct delivery of mail addressed to Martin Francis International Associates, Inc.

            This decision deals only with delivery of the mail.  It does not determine ownership of the contents of the mail, and does not attempt to resolve any other dispute between the parties.  If either party obtains a court order directing delivery of the mail, postal regulations provide that the mail will be delivered according to such an order.  POM §616.3.

            The Judicial Officer should issue an Order to the New York City Postmaster that the disputed mail should be delivered according to the direction of the president of Yale Factors, Inc.

                                                                                    Bruce R. Houston

                                                                                    Chief Administrative Law Judge