Litigation

In a case arising out of the construction of two residential dormitory halls at Fordham University’s Rose Hill campus in the Bronx, Pryor Cashman recently obtained summary judgment on behalf of its clients, a leading construction company, and Travelers Casualty & Surety Co. (“Travelers”). 

At issue in the case was the timeliness of claims made by subcontractor Sentrale Construction Corporation (“Sentrale”) for payment for work performed. Pryor Cashman clients, and the plaintiff in the case, hired Sentrale to perform all substructure and excavation work on the project. Nearly one and half years after Sentrale completed the work, Sentrale claimed that it was entitled to an additional $3.7 million, i.e., 30%, on top of the approximately $12 million it had already been paid by the plaintiff, for additional work and costs which were purportedly outside the scope of the subcontract. 

Pryor Cashman, on behalf of the plaintiff, filed suit against Sentrale in N.Y. County Supreme Court and, in addition to other claims, sought a declaratory judgment that Sentrale was not entitled to the additional $3.7 million it was seeking under the clear and unequivocal terms of their subcontract. Various provisions of the subcontract required Sentrale to provide timely written notice to the plaintiff of any conditions that would increase either the cost or time to complete the project. No such notice had been provided.

Next, Pryor Cashman moved for summary judgment on its declaratory judgment claim, arguing that Sentrale waived its claims by failing to provide the contractually required notice, and seeking dismissal of Sentrale’s claims.

In its August 23, 2011 decision and order, the Court agreed with Pryor Cashman’s arguments and held that New York law requires strict compliance with notice of claim provisions. The Court granted the plaintiff's and Travelers' claim for a declaratory judgment and barred Sentrale’s claims for any additional payments. The Court further found that five out of the six counterclaims asserted by Sentrale were barred for the same reason, i.e., because Sentrale failed to satisfy the contractually required notice provisions of the parties’ subcontract.

While Sentrale’s monetary claims were dismissed, Pryor Cashman is continuing to litigate the plaintiff's claims that Sentrale’s defective work and construction delays caused the plaintiff significant monetary damages.

Pryor Cashman Litigation Partner Jonathan Shepard and associates Joshua Bernstein and Saritha Reddy represented the plaintiff and Travelers in the litigation. 

To read the summary judgment decision in the case, please click here.