| Gallup v Summerset Homes, LLC |
| 2011 NY Slip Op 02241 [82 AD3d 1658] |
| March 25, 2011 |
| Appellate Division, Fourth Department |
| William Gallup et al., Individually and as Parents and NaturalGuardians of Andrew Gallup and Others., Infants,Respondents-Appellants, v Summerset Homes, LLC, Appellant-Respondent, et al.,Defendant. |
—[*1] Ducharme, Harp & Clark, LLP, Clifton Park (Cheryl L. Sovern of counsel), forplaintiffs-respondents-appellants.
Appeal and cross appeal from an order of the Supreme Court, Onondaga County (Anthony J.Paris, J.), entered May 10, 2010 in a breach of contract action. The order granted in part anddenied in part the motion of defendant Summerset Homes, LLC for summary judgment.
It is hereby ordered that the order so appealed from is unanimously modified on the law bygranting those parts of the motion of defendant Summerset Homes, LLC seeking summaryjudgment dismissing the third, sixth, and seventh causes of action and as modified the order isaffirmed without costs.
Memorandum: Plaintiffs, individually and on behalf of their children, commenced this actionseeking damages for personal injuries and property damage they sustained as a result of moldcontamination in their home. We note at the outset that Supreme Court has dismissed theamended complaint against the remaining defendant, and thus the action is now only againstSummerset Homes, LLC (defendant), which built the home. Plaintiff William Gallup enteredinto a purchase contract with defendant for the construction of the home, and the contractincluded a limited warranty. Less than two years after moving into the home, plaintiffs vacatedthe residence. Later testing of the home confirmed the presence of at least four different types ofmold in the basement and other areas of the home. In their amended complaint, plaintiffs allegedcauses of action sounding in breach of contract, tort, and breach of warranty. Defendant movedfor summary judgment dismissing the amended complaint, and the court granted those parts ofthe motion with respect to the second, fourth and fifth causes of action, for negligence and strictproducts liability. The court denied the motion with respect to the first cause of [*2]action, for breach of contract, and the third, sixth and seventhcauses of action, for breach of warranty. Defendant appeals and plaintiffs cross-appeal.
We reject plaintiffs' contention that the court erred in granting the motion with respect to thenegligence and strict products liability causes of action. This is yet another example of a case inwhich causes of action for contract and tort appear to overlap, i.e., "where the parties' relationshipinitially is formed by contract, but there is a claim that the contract was performed negligently"(Sommer v Federal Signal Corp., 79 NY2d 540, 551 [1992]). "It is a well-establishedprinciple that a simple breach of contract is not to be considered a tort unless a legal dutyindependent of the contract itself has been violated . . . This legal duty must springfrom circumstances extraneous to, and not constituting elements of, the contract, although it maybe connected with and dependent upon the contract" (Clark-Fitzpatrick, Inc. v Long Is. R.R.Co., 70 NY2d 382, 389 [1987]). "[M]erely alleging that the breach of a contract duty arosefrom a lack of due care will not transform a simple breach of contract into a tort"(Sommer, 79 NY2d at 551). In considering whether plaintiffs have viable tort causes ofaction, we must also consider "the nature of the injury, the manner in which the injury occurredand the resulting harm" (id. at 552).
Here, the nature of the injury and the resulting harm sound in tort, but the manner in whichthe injury occurred sounds in contract. Plaintiffs allege that the mold formed because ofdefendant's defective workmanship and/or materials, i.e., defendant's failure to exercise due carein its performance of the contract. The injury did not occur because of an "abrupt, cataclysmicoccurrence" (id.; see Syracuse Cablesystems v Niagara Mohawk Power Corp.,173 AD2d 138, 142-143 [1991]). We thus agree with the court that plaintiffs' tort causes ofaction are not viable because there is no legal duty owed by defendant that is independent of thecontract (see Lantzy v Advantage Bldrs.,Inc., 60 AD3d 1254, 1255-1256 [2009]; Rothstein v Equity Ventures, 299 AD2d472, 474 [2002]; Burnell v Morning Star Homes, 114 AD2d 657, 658-659 [1985]).
We agree with defendant, however, that the court erred in denying those parts of its motionseeking summary judgment dismissing the third, sixth, and seventh causes of action, for breachof warranty. We therefore modify the order accordingly. As noted above, the contract contained alimited warranty, and the sixth cause of action alleges a breach of the housing merchant impliedwarranty set forth in General Business Law § 777-a. Contrary to plaintiffs' contention, thatlimited warranty complied with the requirements set forth in General Business Law §777-b, which provides that the housing merchant implied warranty in section 777-a may beexcluded where, as here, the buyer is offered a limited warranty under section 777-b. Thus, thecourt erred in denying defendant's motion with respect to the sixth cause of action (cf. Latiukv Faber Constr. Co., 269 AD2d 820 [2000]). In addition, the court erred in denying themotion with respect to the third cause of action, for breach of common-law express and impliedwarranties, because it is precluded by the limited warranty (see Fumarelli v MarsamDev., 92 NY2d 298, 305 [1998]; Bedrosian v Guzy, 32 AD3d 1194, 1195-1196 [2006]). We furtherconclude that the court erred in denying the motion with respect to the seventh cause of action,for breach of the limited warranty offered to plaintiffs pursuant to General Business Law §777-b. Plaintiffs did not comply with the written notice of claim requirement for the one-year andtwo-year limited warranty provisions, and thus they are entitled to recover, if at all, only underthe six-year warranty provision (see Lantzy, 60 AD3d at 1255; Rothstein, 299AD2d at 474-475). The six-year warranty covered only major structural defects, which aredefined as defects resulting in actual physical damage to a load-bearing portion of the homeaffecting its load-bearing functions to the extent the home becomes "unsafe, unsanitary, orotherwise unlivable." While the mold infestation in plaintiffs' home certainly rendered it "unsafe,unsanitary, [and] otherwise unlivable," it did not affect the load-bearing functions of the home.Plaintiffs therefore do not have a viable cause of action for breach of the six-[*3]year warranty (see generally Finnegan v Brooke Hill, LLC, 38 AD3d 491, 492[2007]).
Finally, we conclude that the court properly denied that part of defendant's motion forsummary judgment dismissing the first cause of action, for breach of contract, which is the soleremaining cause of action. As a general rule, the existence of a statutory limited warrantyprecludes common-law causes of action, including causes of action for breach of contract (seeFumarelli, 92 NY2d at 305; Lantzy, 60 AD3d at 1255; Latiuk, 269 AD2d at820). A breach of contract cause of action, however, is precluded only to the extent it is based onthe breach of warranty (see Tiffany atWestbury Condominium v Marelli Dev. Corp., 40 AD3d 1073, 1075-1076 [2007]; Biancone v Bossi, 24 AD3d 582,584 [2005]). Here, plaintiffs have stated violations of "specific provisions of [the contract] otherthan the warranty provisions," and thus the court properly denied that part of defendant's motionwith respect to the breach of contract cause of action (Tiffany at WestburyCondominium, 40 AD3d at 1076; see Biancone, 24 AD3d at 584). We haveconsidered the remaining contentions of the parties and conclude that they are without merit.Present—Centra, J.P., Peradotto, Lindley, Sconiers and Martoche, JJ.