In a lesson on the importance of timely claims, the Appellant Division, Second Department in New York dismissed a homeowner's breach of contract suit over alleged construction defects in her basement remodel. The case, Hillaire v. Jose A. Torres, N.Y.S.3d, 2024 WL 3281628 (2d Dep’t 2024), involved claims that the defendant botched a flooring installation back in 2015. Since the plaintiff filed their lawsuit nearly seven years after the work was completed—well past New York's six-year statute of limitations for breach of contract—the complaint was ruled too little, too late. The court's decision also made it clear that pandemic-era extensions to filing deadlines, while generous, did not save this claim.
Background of the Case
The dispute stemmed from remodeling work completed in 2015, with the plaintiff asserting that improper installation of the basement flooring led to subsequent issues in the home. The plaintiff contended that the work was defective and failed to meet contractual obligations. Under New York law, breach of contract claims must be filed within six years of the contractor's completion of work, a time frame intended to provide clarity and finality to contracting parties.
In this case, the court found that the statute of limitations started to run on May 26, 2015. This was the date the plaintiff made the final payment on the contract, after which no further work was performed. Nearly seven years later, on January 21, 2022, the plaintiff filed the lawsuit, well beyond the six-year limit. The lower court dismissed the plaintiff's claim. This appeal followed.
Statute of Limitations and Tolling Considerations
Under New York law, breach of contract claims are governed by CPLR § 213(2) which states that a cause of action sounding in breach of contract is governed by a six-year statute of limitations. “A claim against a contractor for damages arising from defective construction accrues, for limitations purposes, upon completion of performance under the contract.” Kamath v. Building New Lifestyles, Ltd., 146 A.D3d 765, 766 (N.Y. app. Div. 2017)
In this case, the court determined that this six-year period began to run upon the contractor's completion of the work, specifically on May 26, 2015, the date of final payment. Consequently, the court found the January 21, 2022, filing date well outside the six-year statutory limit, affirming the dismissal.
The court addressed whether the statute of limitations might be extended due to executive orders issued during the COVID-19 pandemic. New York's emergency orders temporarily tolled various statute of limitations to account for the unprecedented disruptions caused by the pandemic. The plaintiff argued that these orders should extend the filing period, potentially allowing the lawsuit to proceed. However, after calculating the potential tolling effects, the appellate court determined that even with these extensions, the lawsuit remained untimely. Here, the defendant demonstrated that the breach of contract cause of action accrued on May 26, 2015, as the plaintiff made payment under the contract on that date and no further work was performed thereafter. Thus, the defendant established that the plaintiff failed to commence this action within the six-year limitations period.
Legal Implications and Court's Reasoning
In its decision, the Appellate Division underscored the procedural requirements surrounding the statute of limitations, emphasizing the responsibility of the defendant to establish that a claim is time-barred. “[O]n a motion to dismiss a cause of action pursuant to CPLR 3211(a)(5) on the ground that it is barred by the statute of limitations, a defendant bears the initial burden of [establishing], prima facie, that the time in which to sue has expired.” Kaul v. Brooklyn Friends Sch., 220 AD3d 939, 940–941 (2023).
Once this burden is met, it falls to the plaintiff to provide a factual basis for tolling the limitations period or to otherwise justify the timely filing of the claim.
In the case at hand, the plaintiff failed to establish any factual basis that could extend the statute of limitations, leaving the court with little choice but to affirm the dismissal. Accordingly, the Supreme Court properly granted the defendant's motion pursuant to CPLR 3211(a)(5) to dismiss the complaint.
The importance of understanding statutory deadlines in construction defect cases cannot be emphasized enough. Delays in pursuing claims, even when based on genuine grievances, can ultimately lead to the loss of the right to seek relief in court. This case underscores the necessity for plaintiffs to act promptly when they believe they have a valid claim, as time limits for filing are strictly enforced, and exceptions are narrowly construed. For contractors, property owners, and legal practitioners, this ruling reinforces the importance of timely legal action and the complexities surrounding the statutes of limitations, especially in the evolving legal landscape influenced by pandemic-related tolling measures.
This article originally appeared on Wood Smith Henning & Berman LLP. https://www.wshblaw.com/
About the Authors:
Bolam Kim is a partner at Wood Smith Henning & Berman LLP. bkim@wshblaw.com
Cole Munson is a partner at Wood Smith Henning & Berman LLP. cmunson@wshblaw.com