STUDIO 1872 INC 1872 v. Advanced Retail Construction, Inc., Defendant–Respondent. (2024)

Order, Supreme Court, New York County (Suzanne J. Adams, J.), entered May 16, 2023, which denied plaintiff Studio 1872 Inc., doing business as C'est Beau 1872's motion to dismiss defendant Advanced Retail Construction, Inc.'s counterclaims for breach of contract and breach of the implied covenant of good faith and fair dealing, unanimously reversed, on the law, with costs, and the motion granted.

ARC's breach of contract counterclaim is dismissed as barred by the unambiguous language of the release contained in the satisfaction of the mechanic's lien executed by the parties (see Pizzarotti, LLC v. X–Treme Concrete Inc., 205 A.D.3d 487, 488, 488–489, 169 N.Y.S.3d 29 [1st Dept. 2022]).

ARC's counterclaim for breach of the implied covenant of good faith and fair dealing is dismissed because a claim for breach of the implied covenant of good faith and fair dealing “may not be used as a substitute for a nonviable claim for breach of contract” (see Sheth v. New York Life Ins. Co., 273 A.D.2d 72, 73, 709 N.Y.S.2d 74 [1st Dept. 2000]).  In any event, this counterclaim lacks merit because its breach of the implied covenant claim is “intrinsically tied to the damages allegedly resulting from a breach of the contract” (Smile Train, Inc. v. Ferris Consulting Corp., 117 A.D.3d 629, 630, 986 N.Y.S.2d 473 [1st Dept. 2014]).