Edenwald Contracting Co., Inc. v. City of New York

• Decision Date: 29 November 1983
• Parties: , 459 N.E.2d 164 EDENWALD CONTRACTING CO., INC., Respondent, v. CITY OF NEW YORK, Appellant.
• Court: New York Court of Appeals Court of Appeals

Page 55

471 N.Y.S.2d 55

60 N.Y.2d 957, 459 N.E.2d 164

EDENWALD CONTRACTING CO., INC., Respondent, v. CITY OF NEW YORK, Appellant.

Court of Appeals of New York.

Nov. 29, 1983.

Frederick A.O. Schwarz, Jr., Corp. Counsel, New York City (Trudi Mara Schleifer, Leonard Koerner and Francis F. Caputo, Asst. Corp. Counsels, New York City, of counsel), for appellant.

[60 N.Y.2d 958] Alvin Goldstein, New York City, for respondent.

OPINION OF THE COURT MEMORANDUM.

The judgment appealed from and the order of the Appellate Division 89 A.D.2d 836, 453 N.Y.S.2d 697 brought up for review should be reversed, with costs, and the case remitted to that court to consider the question raised within the exercise of its discretion.

Appellant, the City of New York, in 1970 entered into a contract with respondent for street repaving. During 1971, to secure extensions of contract time and expedite periodic payments, respondent signed several letters agreeing to "waive and release all claims which we may have against the City of New York, arising out of the aforesaid contract." Respondent thereafter commenced suit against the city, seeking damages based on unexpected overruns not fairly compensated for by the contract. The action proceeded with no mention by the city of respondent's letters until, six and one-half years after the action had begun, the city sought dismissal of the complaint on the grounds of "waiver and release." The issue presented by this appeal is whether "waiver and release" may be asserted as an affirmative defense for if permitted, this may be dispositive in accordance with Mars Assoc. v. City of New York, 53 N.Y.2d 627, 438 N.Y.S.2d 779, 420 N.E.2d 971.

Trial Term initially denied permission to assert the defense, finding the belated amendment prejudicial to respondent and of dubious merit, and granted summary judgment for respondent on the issue of liability. However, on motion for reargument, renewal and leave to amend the answer, the court reversed itself. It was persuaded that respondent's claim of prejudice was without basis, that the defense of waiver and release was meritorious in light of Mars Assoc. v. City of New York (supra), which had been handed down by this court after Trial Term's initial decision, and that the city should have summary judgment dismissing the complaint. The Appellate Division reversed on the law, holding that (1) there was no consideration for the waiver; (2) the city was guilty of laches in failing to assert waiver for more than five years after service of a note of issue; and (3) the court...