Stonewall Contracting Corp. v. Long Island Rail Rd. Co.

• Decision Date: 12 August 2020
• Docket Number: 2017–05682,Index No. 503994/12
• Citation: 129 N.Y.S.3d 433,186 A.D.3d 640
• Parties: STONEWALL CONTRACTING CORP., Respondent, v. LONG ISLAND RAIL ROAD COMPANY, Appellant.
• Court: New York Supreme Court — Appellate Division

186 A.D.3d 640

129 N.Y.S.3d 433

STONEWALL CONTRACTING CORP., Respondent,

v.LONG ISLAND RAIL ROAD COMPANY, Appellant.

2017–05682

Index No. 503994/12

Supreme Court, Appellate Division, Second Department, New York.

Argued—January 9, 2020

August 12, 2020

Hoguet Newman Regal & Kenney, LLP, New York, N.Y. (Ira J. Lipton, Helene R. Hechtkopf, and Miriam J. Manber of counsel), for appellant.

Rich, Intelisano & Katz, LLP, New York, N.Y. (Daniel E. Katz and Steven Cramer of counsel), for respondent.

RUTH C. BALKIN, J.P., JEFFREY A. COHEN, BETSY BARROS, ANGELA G. IANNACCI, JJ.

DECISION & ORDER

In an action, inter alia, to recover damages for breach of contract, the defendant appeals from an order of the Supreme Court, Kings County (Leon Ruchelsman, J.), dated May 4, 2017. The order, insofar as appealed from, granted those branches of the plaintiff's motion which were for summary judgment dismissing the defendant's fourth affirmative defense and third and fourth counterclaims, and denied the defendant's cross motion for summary judgment dismissing the complaint.

ORDERED that the order is modified, on the law, (1) by deleting the provision thereof granting that branch of the plaintiff's motion which was for summary judgment dismissing the defendant's fourth affirmative defense, and substituting therefor a provision denying that branch of the motion, and (2) by deleting the provision thereof denying the defendant's cross motion for summary judgment dismissing the complaint, and substituting therefor a provision granting the cross motion; as so modified, the order is affirmed insofar as appealed from, without costs or disbursements.

In December 2005, the defendant, Long Island Rail Road Company (hereinafter the LIRR), awarded the plaintiff a contract in the amount of $25,784,209, whereby the plaintiff would serve as the general contractor on a construction project located at the Atlantic Terminal in Brooklyn. The contract provided, among other things, that "[a]ll legal action against the [LIRR] arising out of this Contract shall be initiated within 90 days following Construction Completion," and that "[a]ll rights and remedies relating to all claims, disputes, or legal action filed by the Contractor more than 90 days thereafter, shall be waived and any such item shall be deemed settled." "Construction Completion" is referred to in the contract as a milestone that must be achieved within 616 calendar days from the "Notice of Award." However, during the course of the project, the parties entered into a total of 26 contract modifications, which extended the completion date under the contract to May 31, 2011, and increased the amount due to the plaintiff under the contract "to a revised maximum obligation of $29,646,357.61."

On or about June 7, 2011, the plaintiff submitted to the LIRR its final application for payment for the period ending May 31, 2011, which the LIRR approved on or about July 26, 2011. It is undisputed that, by then, the plaintiff had demobilized from the work site and that "the work was already 100% complete." Thereafter, on May 25, 2012, the plaintiff submitted a "Request for Equitable Adjustment" (hereinafter REA) to the LIRR, seeking an additional payment in the amount of $4,329,619.36, representing the costs that it allegedly incurred due to delays "during the 1095 calendar days" between May 31, 2008, and May 31, 2011. By letter dated July 3, 2012, the LIRR rejected the REA.

In November 2012, approximately one and one-half years after the project was complete, the plaintiff commenced this action against the LIRR, inter alia, to recover damages it allegedly incurred due to construction delays. The LIRR subsequently interposed an answer with affirmative defenses and counterclaims. As relevant here, the fourth affirmative defense alleged that the action was time-barred. The third counterclaim sought to recover liquidated damages, and the fourth counterclaim sought to recover damages for unjust enrichment. The plaintiff moved, inter alia, for summary judgment dismissing the LIRR's fourth affirmative defense and the third and fourth counterclaims, and the LIRR cross-moved for summary judgment dismissing the complaint. The Supreme Court, among other things, granted those branches of the plaintiff's motion and denied the LIRR's cross motion. The LIRR appeals.

The " ‘fundamental, neutral precept of contract interpretation ... [is] that agreements are construed in accord with the parties' intent,’ and ‘[t]he best evidence of what parties to a written agreement intend is what they say in their writing’ " ( 2138747 Ontario, Inc. v. Samsung C & T Corp., 31 N.Y.3d 372, 377, 78 N.Y.S.3d 703, 103 N.E.3d 774, quoting Greenfield v. Philles Records, 98 N.Y.2d 562, 569, 750 N.Y.S.2d 565, 780 N.E.2d 166 ; see Deutsche Bank Natl. Trust Co. v. Barclays Bank PLC, 34 N.Y.3d 327, 340, 117 N.Y.S.3d 137, 140 N.E.3d 511 ). " ‘[W]here the terms of a contract are clear and unambiguous, the intent of the parties must be found within the four corners of the contract, giving a practical interpretation to the language employed and reading the contract as a whole’ " ( Tomhannock, LLC v. Roustabout Resources, LLC, 33 N.Y.3d 1080, 1082, 104 N.Y.S.3d 596, 128 N.E.3d 674, quoting Ellington v. EMI Music, Inc., 24 N.Y.3d 239, 244, 997 N.Y.S.2d 339, 21 N.E.3d 1000 ).

Further, " ‘[a]n agreement which modifies the Statute of Limitations by specifying a shorter, but reasonable, period within which to commence an action is enforceable’ " ( Executive Plaza, LLC v. Peerless Ins. Co., 22 N.Y.3d 511, 518, 982 N.Y.S.2d 826, 5 N.E.3d 989, quoting John J. Kassner & Co. v. City of New York, 46 N.Y.2d 544, 551, 415 N.Y.S.2d 785, 389 N.E.2d 99 ; see J Constr. Co., LLC v. Westchester Fire Ins. Co., 165 A.D.3d 1076, 1078, 87 N.Y.S.3d 585 ). " ‘[T]he period of time within which an action must be brought ... should be fair and reasonable, in view of the circumstances of each particular case.... The circumstances, not the time, must be the determining factor’ " ( Executive Plaza, LLC v. Peerless Ins. Co., 22 N.Y.3d at 519, 982 N.Y.S.2d 826, 5 N.E.3d 989, quoting Continental Leather Co. v. Liverpool, Brazil & Riv. Plate Steam Nav. Co., 259 N.Y. 621, 622–623, 182 N.E. 207 ; see D & S Restoration, Inc. v. Wenger Constr. Co., Inc., 160 A.D.3d 924, 926, 75 N.Y.S.3d 505 ). "Absent proof that the contract is one of adhesion or the product of overreaching, or that [the] altered period is unreasonably short, the abbreviated period of limitation will be enforced" ( State of Narrow Fabric, Inc. v. UNIFI, Inc., 126 A.D.3d 881, 883, 5 N.Y.S.3d 512 [internal quotation marks omitted]; see John v. State Farm Mut. Auto. Ins. Co., 116 A.D.3d 1010, 1011, 983 N.Y.S.2d 883 ).

Here, the LIRR demonstrated, prima facie, that the time within which to commence this action had expired inasmuch as the plaintiff failed to commence this action within 90 days after May 31, 2011, when construction was indisputably complete (see Piliaskas v....