| Rifenburg Constr., Inc. v State of New York |
| 2011 NY Slip Op 09375 [90 AD3d 1498] |
| December 23, 2011 |
| Appellate Division, Fourth Department |
| Rifenburg Construction, Inc., Respondent-Appellant, v State ofNew York, Appellant-Respondent. (Claim No. 111868.) |
—[*1] Fox & Kowalewski, LLP, Clifton Park (Laurence I. Fox of counsel), forclaimant-respondent-appellant.
Appeal and cross appeal from an order of the Court of Claims (Renee Forgensi Minarik, J.),entered June 22, 2010. The order denied the motion of defendant for summary judgment.
It is hereby ordered that said cross appeal is unanimously dismissed and the order is modifiedon the law by granting those parts of the motion for summary judgment dismissing the third andfourth causes of action and as modified the order is affirmed without costs.
Memorandum: The New York State Department of Transportation (DOT) entered into acontract with claimant for the reconstruction of 6.9 miles of Route 332 in Farmington (hereafter,project). The project involved expanding the road from two to four lanes and building two newbridges at a cost of over $26 million. Following completion of the project, claimant commencedthis action seeking compensation for extra work under the terms of the contract. As limited by itsbrief, defendant appeals from an order insofar as it denied those parts of defendant's motion forsummary judgment dismissing the first through fourth and seventh causes of action.
With respect to the first through fourth causes of action, defendant contends that it is entitledto judgment as a matter of law based on the strict notice and reporting requirements contained inthe construction contract. Those contract provisions require claimant, inter alia, to provideprompt notice to DOT of any request for payment for "extra work" that it performs and to submit"a daily summary of FORCE ACCOUNT WORK done on the contract." The contract requires"[s]trict compliance" with the notice provisions and "compliance" with the record-keepingprovisions. Contract clauses that "require the contractor to promptly notice and document itsclaims made under the provisions of the contract governing the substantive rights and liabilitiesof the parties . . . are . . . conditions precedent to suit or recovery"(A.H.A. Gen. Constr. v New York City Hous. Auth., 92 NY2d 20, 30-31 [1998],rearg denied 92 NY2d 920 [1998]; see Sicoli & Massaro v Niagara Falls Hous.Auth., 281 AD2d 966 [2001]; Tug Hill Constr. v County of Broome, 270 AD2d 755,756 [2000]). "[A] condition precedent is 'an act or event, other than a lapse of time, [*2]which, unless the condition is excused, must occur before a duty toperform a promise in the agreement arises' " (MHR Capital Partners LP v Presstek, Inc., 12 NY3d 640, 645[2009], quoting Oppenheimer & Co. v Oppenheim, Appel, Dixon & Co., 86 NY2d 685,690 [1995]). "Express conditions must be literally performed; substantial performance will notsuffice" (MHR Capital Partners LP, 12 NY3d at 645). "Failure to strictly comply withsuch provisions generally constitutes waiver of a claim for additional compensation" (Fahs Rolston Paving Corp. v County ofChemung, 43 AD3d 1192, 1194 [2007]; see also Bat-Jac Contr. v New York City Hous. Auth., 1 AD3d 128[2003]).
We agree with defendant that the Court of Claims erred in denying those parts of its motionwith respect to the third and fourth causes of action. We therefore modify the order accordingly.Those causes of action seek compensation for extra work performed for controlling andprotecting traffic during the project and for performing survey work, respectively. According toclaimant, the extra work was necessitated by the numerous changes made by DOT during theproject. The traffic control and survey work were fixed cost items under the contract for whichclaimant was entitled to extra compensation only where additions to the project exceeded 25% ofthe original bid price. In support of its motion, defendant established that claimant did notcomply with the notice and reporting requirements of the contract, and claimant failed to raise atriable issue of fact in opposition (see generally Zuckerman v City of New York, 49NY2d 557, 562 [1980]). Claimant's assertion that the numerous changes made by DOT duringthe project made it extremely difficult to calculate the extra traffic control and survey costs doesnot justify claimant's failure to comply with the notice and reporting requirements of the contract.Those requirements are expressly designed to alert defendant to cost over-runs at the earliestpossible time in order to allow it to take steps to avoid such extra expenses in the interest ofprotecting the public fisc (see A.H.A. Gen. Constr., 92 NY2d at 33-34).
We further conclude, however, that the court properly denied the motion with respect to thefirst and second causes of action. The first cause of action seeks compensation for the extra costsinvolved in construction of the bridges, which claimant alleges were necessitated by design errorson the part of DOT. Defendant met its initial burden on the motion with respect to that cause ofaction by establishing that claimant breached the contract notice provisions inasmuch as it failedto make a timely claim for additional compensation. In opposition to the motion, however,claimant submitted evidence demonstrating not only that DOT was aware of the design errors butthat DOT prepared documents during the project suggesting that claimant would be compensatedfor the extra work in question.
The second cause of action seeks compensation "for significant changes to and under[-]runsin the quantity of work" estimated by DOT in the project specifications. Defendant met its initialburden on the motion with respect to that cause of action by establishing when such under-runsoccurred and that, by failing to provide timely notice of its request for additional compensation,defendant did not satisfy a condition precedent for such request. We conclude, however, thatclaimant raised triable issues of fact whether it knew or should have known of those under-runsgiven the numerous additions and deletions to the quantity of work in the project, including theadditional construction of three-quarters of a mile of water line.
Further, the court properly denied that part of defendant's motion with respect to the seventhcause of action, seeking payment of interest pursuant to State Finance Law § 179-f on theground that DOT's final payment under the contract was untimely. Defendant contends that it isentitled to summary judgment dismissing that cause of action because its final payment wastimely in light of claimant's delay in submitting all of the documentation necessary for that [*3]payment to be issued. We reject that contention. Defendantaccepted the work of the project on November 24, 2003 but did not provide written notice toclaimant of the missing documentation until August 3, 2005. We conclude that the 18-monthperiod in question is not excluded for purposes of calculating the timeliness of defendant's finalpayment (see 2 NYCRR 18.13).
Finally, claimant is not aggrieved by the order denying defendant's motion, and thus its crossappeal must be dismissed (see Weichert v Shea, 186 AD2d 992 [1992]; seegenerally CPLR 5511). Present—Fahey, J.P., Carni, Sconiers, Gorski and Martoche,JJ.