1199 Housing Corp. v. International Fidelity Ins. Co.

• Citation: 14 A.D.3d 383,2005 NY Slip Op 00205,788 N.Y.S.2d 88
• Decision Date: 13 January 2005
• Docket Number: 4552.
• Parties: 1199 HOUSING CORPORATION, Appellant-Respondent, v. INTERNATIONAL FIDELITY INSURANCE COMPANY, Respondent-Appellant, et al., Defendants. (And Other Actions.)
• Court: New York Supreme Court Appellate Division

14 A.D.3d 383

788 N.Y.S.2d 88

2005 NY Slip Op 00205

1199 HOUSING CORPORATION, Appellant-Respondent, v. INTERNATIONAL FIDELITY INSURANCE COMPANY, Respondent-Appellant, et al., Defendants. (And Other Actions.)

4552.

Appellate Division of the Supreme Court of the State of New York, First Department.

January 13, 2005

Order, Supreme Court, New York County (Richard B. Lowe, III, J.), entered October 20, 2003, which granted defendant International Fidelity Insurance Company's motion to dismiss the complaint except as to the ninth cause of action seeking delay damages, and denied plaintiff's cross motion to dismiss Fidelity's 14th and 18th affirmative defenses, unanimously modified, on the law, to reinstate the complaint, grant the cross motion and dismiss said affirmative defenses and, except as so modified, affirmed, without costs.

In this action on a performance bond covering heating system renovation work undertaken by defendant Kelly Tank Company, defendant surety sought dismissal of the complaint for, inter alia, failure to allege compliance with unspecified conditions contained in the instrument. By cross motion, plaintiff owner sought to dismiss any defense predicated on such basis, specifi cally the 14th and 18th affirmative defenses, for failure to comply with CPLR 3015 (a). Supreme Court declined to dismiss the defenses on the ground that the bond's notice provisions constitute conditions precedent to the surety's obligations thereunder. Thus, the court reasoned, plaintiff's failure to comply with the notice provisions constitutes a bar to recovery under the instrument except as to damages occasioned by Kelly Tank's delay in performance, to which the court deemed the notice provisions to be inapposite.

Supreme Court placed an improper pleading burden on plaintiff. On a motion to dismiss directed at the sufficiency of the complaint, the plaintiff is afforded the benefit of a liberal construction of the pleadings: "The scope of a court's inquiry on a motion to dismiss under CPLR 3211 is narrowly circumscribed" (P.T. Bank Cent. Asia v ABN AMRO Bank, 301 AD2d 373, 375 [2003]), the object being "to determine if, assuming the truth of the facts alleged, the complaint states the elements of a legally cognizable cause of action" (id. at 376; see Rovello v Orofino Realty Co., 40 NY2d 633, 634 [1976]).

Defendant, by contrast, is subject to a strict pleading provision. In an action on a contract, the obligation to raise the issue of compliance with conditions precedent rests on the party disputing...