DANCO ELECTRICAL CONTRACTORS INC v. DORMITORY AUTHORITY OF STATE (2018)

Order, Supreme Court, New York County (Eileen Bransten, J.), entered May 9, 2017, which, insofar as appealed from, granted defendant's motion for summary judgment dismissing the second and third causes of action to the extent based on change order proposals 24, 46R, 54, 61, 91, 97, 99, 125, 133, 148, 152, 153, 155, 157, 159, 161, 162, 163, 167, 174, 193, 197, 199, 202, 210, 211, and 213, unanimously reversed, on the law, without costs, and the motion denied.

It is undisputed that plaintiff failed to satisfy a condition precedent to recovering disputed costs for extra work on which defendant forced price reductions.  Although plaintiff gave detailed written statements contesting defendant's determinations of the fair and reasonable value of the extra work pursuant to section 8.01(B), it failed to give verified statements pursuant to section 11.03(A) of the contractual General Conditions.

Nevertheless, we conclude that plaintiff should be excused from the non-occurrence of that condition, because otherwise it would suffer a disproportionate forfeiture, and the occurrence of the condition was not a material part of the agreed exchange (see Oppenheimer & Co. v. Oppenheim, Appel, Dixon & Co., 86 N.Y.2d 685, 691, 636 N.Y.S.2d 734, 660 N.E.2d 415 [1995], citing Restatement [Second] of Contracts § 229).  Defendant does not argue that plaintiff failed to document the costs of the claimed extra work, to provide timely notice of its claims for extra work, or to provide timely notice of its objections to defendant's rejections of and price reductions on the claimed extra work.  Nor does it contend other than in conclusory terms that plaintiff's failure to submit verified written statements was prejudicial to it.  Moreover, the cases on which defendant relies did not consider whether the failure to strictly comply with a condition precedent should be excused to avoid a disproportionate forfeiture under the circumstances of a case such as this, where the noncompliance is de minimis and defendant has shown no prejudice whatsoever (see e.g. Mezzacappa Bros., Inc. v. City of New York, 29 A.D.3d 494, 815 N.Y.S.2d 549 [1st Dept. 2006], lv denied 7 N.Y.3d 712, 824 N.Y.S.2d 604, 857 N.E.2d 1135 [2006];  Schindler El. Corp. v. Tully Constr. Co., Inc., 139 A.D.3d 930, 30 N.Y.S.3d 707 [2d Dept. 2016] ).

In view of the foregoing, we do not reach plaintiff's remaining contentions.