GAMMA USA INC v. PAVARINI MCGOVERN LLC (2025)

Order, Supreme Court, New York County (Melissa A. Crane, J.), entered September 24, 2024, which granted defendant's motion to dismiss plaintiff's cause of action for breach of contract and delay damages (first cause of action), unanimously affirmed, without costs.

Supreme Court correctly dismissed the first cause of action because the parties’ subcontract, which defendant submitted on its motion to dismiss, “flatly rejected” plaintiff's allegations that it was entitled to damages caused by delay in the project (Basis Yield Alpha Fund [Master] v. Goldman Sachs Group, Inc., 115 A.D.3d 128, 135, 980 N.Y.S.2d 21 [1st Dept. 2014];  see also Guggenheimer v. Ginzburg, 43 N.Y.2d 268, 275, 401 N.Y.S.2d 182, 372 N.E.2d 17 [1977]).  Under the plain terms of the subcontract, the no-damages-for-delay clause expressly exculpates defendant from liability to plaintiff for damages resulting from delays in defendant's work (see Corinno Civetta Constr. Corp. v. City of New York, 67 N.Y.2d 297, 313–314, 502 N.Y.S.2d 681, 493 N.E.2d 905 [1986]).

The subcontract is not ambiguous, nor do any purportedly conflicting provisions open the door for plaintiff to recover delay damages.  Section 6.3 of the subcontract provides that “notwithstanding any other provisions” of the subcontract, plaintiff “agree[d] to make no claim for additional costs on account of, and assume[d] the risk of, any and all loss and expense for delay.”  This “notwithstanding” language overrides any conflicting provisions in the subcontract (see CNH Diversified Opportunities Master Account, L.P. v. Cleveland Unlimited, Inc., 36 N.Y.3d 1, 16, 136 N.Y.S.3d 199, 160 N.E.3d 667 [2020]).

Despite plaintiff's contentions, the allegations in the first cause of action, even if true, do not show that plaintiffs may recover under any of the recognized exceptions to application of exculpatory language (see Corinno Civetta Constr., 67 N.Y.2d at 309, 502 N.Y.S.2d 681, 493 N.E.2d 905).  Defendant's alleged conduct does not “smack of intentional wrongdoing,” nor does it bespeak a “reckless indifference to the rights of others” (Kalisch–Jarcho, Inc. v. City of New York, 58 N.Y.2d 377, 385, 461 N.Y.S.2d 746, 448 N.E.2d 413 [1983]).  Instead, defendant's alleged actions amount at most to “inept administration or poor planning,” which does not obviate application of the no-damages-for-delay provision (WDF, Inc. v. Trustees of Columbia Univ. in the City of N.Y., 170 A.D.3d 518, 519, 96 N.Y.S.3d 42 [1st Dept. 2019] [internal quotation marks omitted]).

Furthermore, the alleged delays in commencement, prosecution, and completion of plaintiff's work did not constitute uncontemplated delays for which a plaintiff may recover damages even in the face of a no-damages-for-delay clause.  In fact, each type of delay was specifically mentioned in the subcontract's no-damages-for-delay clause (see LoDuca Assoc., Inc. v. PMS Constr. Mgt. Corp., 91 A.D.3d 485, 485, 936 N.Y.S.2d 192 [1st Dept. 2012]).  Moreover, that there was a year-long delay in the commencement of plaintiff's work is of no moment, as the length of a delay does not transform a delay of a type specifically contemplated in a no-damages-for-delay clause into an uncontemplated delay (see id. at 486, 936 N.Y.S.2d 192;  see also Dart Mech. Corp. v. City of New York, 68 A.D.3d 664, 664, 891 N.Y.S.2d 76 [1st Dept. 2009]).

Similarly, the allegations in the complaint do not show that defendant breached a “fundamental, affirmative obligation” that would support recovery for delay damages even in light of the no damages for delay clause (see Corinno Civetta Constr., 67 N.Y.2d at 313, 502 N.Y.S.2d 681, 493 N.E.2d 905).  On the contrary, that exception is applied to only a narrow range of circumstances not presented here (see id.).  Even if plaintiff's allegations that defendant failed to provide critical path method schedules and instead provided two-week look-ahead schedules, were true, it does not constitute a fundamental breach of the contract (see Plato Gen. Constr.  Corp./EMCO Tech Constr. Corp., JV, LLC v. Dormitory Auth. of State of N.Y., 89 A.D.3d 819, 824, 932 N.Y.S.2d 504 [2d Dept. 2011], lv denied 19 N.Y.3d 803, 2012 WL 1592167 [2012]).  Nor does defendant's decision to remove a crane constitute a breach of a fundamental obligation, as plaintiff identifies no contractual terms that would support such a conclusion.  Defendant's alleged representation that a crane would be available for “oversized panels” is not incorporated in the crane and hoist-related scope of work provisions, which warn that “hoist size and capacity are limited” and place responsibility on plaintiff to hoist items that exceed the hoist capacity.  Finally, the site logistics plan was expressly subject to change, while the subcontract further required plaintiff to “coordinate ․ all material deliveries and their storage locations” with defendant and to move stored materials at defendant's direction.

We have considered plaintiff's remaining contentions and find them unavailing.