Waters of Saratoga Springs, Inc. v. State

• Decision Date: 16 January 1986
• Citation: 116 A.D.2d 875,498 N.Y.S.2d 196
• Parties: WATERS OF SARATOGA SPRINGS, INC., Appellant, v. STATE of New York, Respondent.
• Court: New York Supreme Court — Appellate Division

Page 196

498 N.Y.S.2d 196

116 A.D.2d 875

WATERS OF SARATOGA SPRINGS, INC., Appellant, v. STATE of New York, Respondent.

Supreme Court, Appellate Division Third Department.

Jan. 16, 1986.

Wolfe, Yukelson & Adler (Harvey G. Wolfe, of counsel), New York City, for appellant.

Robert Abrams (Richard J. Dorsey, of counsel), Albany, for respondent.

Before MAHONEY, P.J., and KANE, CASEY, WEISS and LEVINE, JJ.

MAHONEY, Presiding Justice.

Appeal from an order of the Court of Claims (Koreman, P.J.), entered December 24, 1984, which denied claimant's application to deem its notice of intention to file a claim as a notice of claim and granted the State's cross motions to dismiss the claim and the amended claim.

Claimant and the State Office of Parks and Recreation entered into a licensing agreement on June 29, 1978 whereby claimant obtained the right to bottle and market mineral water from springs and wells located on a State park in the City of Saratoga Springs, Saratoga County. In December 1981, the State Department of Health informed claimant that it was required to place certain warning labels on all bottled water sold after January 29, 1982. Claimant, believing that the warning label made the product unsaleable and, further, that the facts surrounding the labeling requirement constituted a breach of contract, a breach of warranty and fraud, timely filed a notice of intention to file a claim on April 19, 1982. Claimant filed a claim on April 23, 1984 and promptly moved to have its notice of intention be deemed a claim. The State cross-moved to dismiss the claim. While these motions were pending, claimant filed an amended claim on August 23, 1984 which listed six causes of action. The State then moved to dismiss this amended claim. The Court of Claims refused to deem claimant's notice of intention a claim and dismissed the claim and amended claim. This appeal by claimant ensued.

Initially, we hold that the Court of Claims was correct in denying claimant's motion to deem its notice of intention as a claim. While the notice of intention was timely filed within six months of the accrual of the action (Court of Claims Act § 10), such a filing cannot hold open indefinitely the period within which to file a claim. It is readily apparent that the claim filed on April 23, 1984 was not presented within the two-year period mandated by Court of Claims Act § 10(4). In order for a notice of intention to be treated as a claim, it must comply with the basic requirements of a claim (Patterson v. State of New York, 54 A.D.2d 147, 149, 388 N.Y.S.2d 420, affd. 45 N.Y.2d 885, 410 N.Y.S.2d 812, 383 N.E.2d 114). It must allege all the necessary elements of a valid cause of action (Heisler v. State of New York, 78 A.D.2d 767, 768, 433 N.Y.S.2d 646). A careful reading of the allegations recited in the notice of intention reveals that they are addressed to the imposition of a labeling requirement by the Department of Health. Such action by the Department is sovereign activity and the State has not waived immunity with respect to such activities (see, Hodes v. State of New York, 113 A.D.2d 126, 495 N.Y.S.2d 279; Abruzzo v. State of New York, 84 A.D.2d 876, 877, 444 N.Y.S.2d 739). Accordingly, since the notice of intention fails to state a cause of action, the Court of Claims properly declined to treat it as a claim.

Turning to the claim and amended claim, it appears that they were filed beyond the two-year period prescribed by Court of Claims Act § 10(4). However, claimant insists that causes of action are set forth therein which arose subsequent to the filing of the notice of intention. Specifically, claimant asserts that the amended claim contains allegations that constitute a breach of contract action which occurred within six months prior to the filing of the amended claim (Court of Claims Act § 10), as well as allegations constituting an action for fraud which was first discovered within 90 days of such filing (Court of Claims Act § 10).

In the first cause of action of the amended claim, claimant asserts that the State committed a continuing breach of contract up until the date of the filing of the amended claim. We disagree. Although the contract was to extend to 1990, we cannot ignore the reality of the situation. Claimant alleges that it was forced to cease operations in 1982 because of the labeling requirement. It has not processed any water since that time. Accordingly, any injury suffered by claimant was ascertainable in 1982. Clearly, the action alleging a continuous breach of contract is untimely.

Similarly, claimant's second, third and fourth causes of action in the amended claim, alleging that the State breached various express and implied warranties in the licensing agreement, must be dismissed...