Arnold v. New City Condominiums Corp.

• Decision Date: 17 November 1980
• Citation: 78 A.D.2d 882,433 N.Y.S.2d 196
• Parties: Vincent E. ARNOLD et al., Respondents, v. NEW CITY CONDOMINIUMS CORP., Appellant (and a third-party action).
• Court: New York Supreme Court — Appellate Division

Page 196

433 N.Y.S.2d 196

78 A.D.2d 882

Vincent E. ARNOLD et al., Respondents, v. NEW CITY CONDOMINIUMS CORP., Appellant (and a third-party action).

Supreme Court, Appellate Division, Second Department.

Nov. 17, 1980.

Shapiro & Goodfriend, Spring Valley (Mark F. Goodfriend, Spring Valley, of counsel), for appellant.

Fuchsberg & Fuchsberg, New York City (Donald M. Halperin, New York City, of counsel), for respondents.

Before TITONE, J. P., and GIBBONS, MARGETT and O'CONNOR, JJ.

MEMORANDUM BY THE COURT.

In an action inter alia to recover damages for breach of warranty and negligence resulting in damage to property, defendant appeals, as limited by its brief, from so much of an order of the Supreme Court, dated May 31, 1979 and entered in Rockland County, as denied its motion for summary judgment as to all plaintiffs, except that the motion was granted as to the second cause of action of plaintiffs Green.

Order affirmed insofar as appealed from, with $50 costs and disbursements.

Plaintiffs are purchasers of condominiums constructed by defendant. With the exception of plaintiffs Leslie and Phyllis Green, whose cause of action for breach of warranty was dismissed for lack of privity, plaintiffs signed a contract of sale, incorporating provisions of the prospectus, which, inter alia, guaranteed the basement of each unit against leakage or seepage for a period of one year from the date of closing of title of such unit, provided that defendant received written notice of the defect by registered or certified mail. The prospectus further provided that defendant "shall not be responsible for consequential damages, and (defendant's) guarantees and warranties are limited as set forth herein." Defendant also promised to correct defects in the common elements, if it received written notice of the defect within one year from the "date of substantial completion of the defective common element or the date of filing the Declaration of Condominium, whichever is later." Defendant contends that the common elements were substantially completed before January 1, 1972, therefore the date of filing of the Declaration of Condominium, August 30, 1973, is controlling. Plaintiffs contend that there is an issue of fact as to when the common elements were substantially completed and an affidavit from plaintiff Nicholas Perfito indicates that defendant was still working on the drainage system in January, 1974.

Plaintiffs contend that on October 11, 1974 they notified defendant in writing of defects in the drainage system which resulted in the flooding of basements of individual units. After the condominiums were flooded on June 30, 1976, plaintiffs commenced the instant action asserting causes of action for negligence and breach of warranty. Defendant contends that these causes of action are barred by plaintiffs' failure to comply with the notice requirements in the prospectus, which was incorporated into the contract of sale, and by the disclaimer of liability for consequential damages. Defendant also contends that plaintiffs' causes of action are barred by the Statute of Limitations set forth in CPLR 214 (subd. 6).

Special Term held that the disclaimer and notice requirements were invalid, because those provisions were set forth in print of the same type size and appearance as the rest of the surrounding print, and therefore were not "conspicuously delineated" (see Uniform Commercial Code, § 2-316, subd. (2); Nassau Suffolk White Trucks v. Twin County Tr. Mix Corp., 62 A.D.2d 982, 403 N.Y.S.2d 322). However, article 2 of the Uniform Commercial Code applies to the sale of goods (see Uniform Commercial Code, § 2-102), not to the sale of real property. The disclaimer and notice requirements were legibly displayed, and therefore may not be deemed invalid on this ground (see Winant v. Approved Ladder & Equip. Corp., 31 A.D.2d 965, 298 N.Y.S.2d 796, aff'd. 28 N.Y.2d 529, 319 N.Y.S.2d 72, 267 N.E.2d 885).

Disclaimers of liability must be strictly construed (see Gross v. Sweet, 49 N.Y.2d 102, 108, 424 N.Y.S.2d 365, 400 N.E.2d 306; Ciofalo v....