Originally published by Matthew DeVries on Best Practices Construction Law blog.
Why is it important to read your contract? In this instance, one party’s failure to strictly follow the contractual notice provision was a $209,235.36 mistake.
In Schindler v. Tully Construction Co., 139 A.D.3d 930 (May 18, 2016), the New York Supreme Court, Appellate Division, reversed a trial court’s award of delay damages in favor of a subcontractor on a public contract. The general contractor entered into an agreement with the City of New York Department of Sanitation to construct a garage. The subcontractor agreed to to furnish and install five elevators for the project. Although the court’s decision does not elaborate on the details, the subcontractor filed suit and was awarded more than $200,000 in damages incurred as a result of delays in performance of the work.
The prime contract between the City and the general contractor, which was incorporated into the subcontract by reference, contained a strict notice provision. The court found that the contract contained “a condition-precedent type notice provision.” The appellate court held that the letters and emails relied upon by the trial court “did not strictly comply with the contractual notice requirement, since they did not contain verified statements of the amount of delay damages allegedly sustained by the plaintiff and were unsupported by documentary evidence.”
(read more about the Schindler v. Tully Construction case and what contractors can learn from it...)
