By Jessica Dye
NEW YORK, Dec 6 (Reuters) - A Queens judge has denied a
contractor's bid to dismiss a lawsuit brought by the city for
defective construction work, saying the statute of limitations
did not begin to run until the physical work required by the
contract was completed.
Supreme Court Justice Orin Kitzes on Nov. 27 denied a motion
from contractor Admiral Construction LLC to dismiss the 2012
lawsuit brought by the New York City School Construction
Authority. The lawsuit sought $1.7 million for allegedly
defective construction work that Admiral had performed on a
public school in Brooklyn.
In moving to dismiss the suit, Admiral argued that it was
filed four days after the six-year statute of limitations for
breach of contract claims had expired. To calculate when the
statute of limitations began running, Admiral used June 29,
2006, the date when the construction authority certified the
project as "substantially completed."
Admiral cited several rulings from state trial and appellate
courts that used the date of substantial completion to calculate
the statute of limitations for breach of contract claims brought
by contractors seeking payment from owners.
The city responded by citing a 1995 Court of Appeals ruling,
City School District v. Hugh Stubbins & Associates, which found
that "an owner's claim arising out of defective construction
accrues on date of completion."
Kitzes agreed with the city.
Unlike breach of contract claims brought against owners by
contractors, claims brought by owners against contractors accrue
on the date the physical work is actually completed, the judge
"(I)t would be unfair to limit an owner's time to commence
an action for defective work to a period when the work has not
been completed and the defective work might not be apparent,"
Kitzes wrote. "Consequently, it would be unfair to allow an
owner to delay the accrual of the claim for payment until the
work was fully completed."
A lawyer for the SCA, New York City Law Department senior
counsel Gerald Singleton, said that the ruling "makes clear the
distinction, for statute of limitations purposes, the difference
between a claim by an owner for defective performance and a
claim by a contractor for payment."
A lawyer for Admiral could not be immediately reached for
comment Thursday afternoon.
The case is New York City School Construction v. Admiral
Construction LLC, Queens Supreme Court, No. 701218/2012.
For SCA: Gerald Singleton of the New York City Law
For Admiral: Michael Galina and Gayle Rosen of Rabinowitz &