A.H.A. General Construction, Inc. v. New York City Housing Authority

699 N.E.2d 368, 92 N.Y.2d 20, 677 N.Y.S.2d 9, 1998 N.Y. LEXIS 1424
CourtNew York Court of Appeals
DecidedJune 11, 1998
StatusPublished
Cited by315 cases

This text of 699 N.E.2d 368 (A.H.A. General Construction, Inc. v. New York City Housing Authority) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A.H.A. General Construction, Inc. v. New York City Housing Authority, 699 N.E.2d 368, 92 N.Y.2d 20, 677 N.Y.S.2d 9, 1998 N.Y. LEXIS 1424 (N.Y. 1998).

Opinion

OPINION OF THE COURT

Chief Judge Kaye.

This appeal centers on the notice and reporting requirements contained in two construction agreements between respondent (A.H.A. General Contracting, Inc.) and appellant (New York City Housing Authority). Seeking damages for extra work, respondent contends that the Housing Authority committed misconduct in its performance of the contracts, entitling respondent to recover despite its own noncompliance with the notice and reporting requirements. We conclude that because there is no showing that appellant’s alleged misconduct in any way prevented or hindered respondent’s compliance with those [24]*24contract requirements, appellant’s summary judgment motion dismissing the complaint should be granted.

I.

In July 1990, the Housing Authority — a public benefit corporation that builds, operates and maintains housing for low-income individuals throughout New York City — publicly bid two Bronx construction contracts, one related to the rehabilitation of three buildings and the creation of park areas on Jennings Street (the Jennings contract) and the second to rehabilitation work on three buildings on Hoe Avenue (the Hoe contract). On October 5, 1990, the Housing Authority awarded respondent the Jennings contract for the price of $2,316,000 and the Hoe contract for the price of $2,410,000.

The Jennings and Hoe agreements include identical provisions regarding “extra work” (i.e., work other than that required by the contract at the time of its execution). Article 25 enables the Authority to order extra work and requires the contractor to perform it. When extra work is ordered, a change order detailing the nature of the job and providing a price increase for the labor is signed to compensate the contractor. As Article 25 states:

“Article 25. Extra Work. This Contract may be modified or changed by the Housing Authority from time to time, in a manner not materially affecting the substance thereof or increasing the price to be paid by more than ten (10%) percent of the contract price in order to carry out and complete more fully and perfectly the Work herein agreed to be done and performed. An order for Extra Work, shall designate the method of payment therefore, and shall be valid only if issued in writing and signed by the Housing Authority. Work so ordered must be performed by the Contractor.”

The two agreements also contain notice and reporting requirements — i.e., requirements that respondent timely submit notices of claim and relevant documentation to reserve its right to receive payment for any extra work. These requirements enable the Authority to verify whether allegedly extra work is in fact beyond the scope of the contract, as well as the time, labor, material and cost involved. Article 27 sets forth the procedures to be followed in the event the parties disagree over whether certain work is within or beyond the scope of the original contract:

[25]*25“Article 27. Disputed Work. * * *. [I]f the Housing Authority determines that the Work in question is Contract Work and not Extra Work, or that the determination or order complained of is proper, he will direct the Contractor to proceed, and the Contractor must promptly comply. However, in order to reserve his right to claim compensation for such Work or damages resulting from such compliance, the Contractor must, within five (5) days after receiving notice of the Housing Authority’s determination and direction, notify the Commissioner in writing that the work is being performed, or that the determination and direction is being complied with, under protest. * * *
“If the Contractor shall claim to be sustaining damages by reason of any act or omission of the Housing Authority or the City or its agents, he shall within five (5) days after such act or omissions occur, notify the Housing Authority in writing, and within thirty (30) days thereafter, or within such additional time in excess of thirty (30) days as may be granted by the Housing Authority upon written request therefor, submit to the Housing Authority verified detailed statements of the damages sustained together with documentary evidence of such damages. Upon failure of the Contractor to fully comply with the foregoing provisions, such claims shall be deemed waived and no right to recover on such claims shall exist.”

Belatedly, Article 28 mandates that respondent furnish the Authority with daily written statements documenting the disputed work, as follows:

“Article 28. Performance of Extra or Disputed Work. While the Contractor or his Subcontractor is performing Extra Work ordered by the Housing Authority under Article 25 hereof (unless payment therefore is to be made by a lump sum or at unit prices previously agreed upon) or is performing disputed Work or complying with a determination or order under protest in accordance with Article 27 hereof, in each such case the Contractor shall furnish the Housing Authority daily with three copies of written statements signed by the Contractor’s representatives at the site showing:
[26]*26“(1) the name and number of each workman employed on such Work or engaged in complying with such determination or order, the number of hours employed thereon, and the character of work each is doing; and
“(2) the nature and quantity of any materials, plant and equipment furnished or used in connection with the performance of such Work or compliance with such determination or order, and from whom purchased or rented. * * *
“Failure to comply strictly with these requirements shall constitute a waiver of any claim for extra compensation or damages on account of the performance of such Work or compliance with such determination or order.”

Article 51 underscores the importance of the notice and reporting provisions. It precludes the contractor from asserting any cause of action against the Housing Authority without first “strictly” adhering to those provisions:

“Article 51. Claims and Actions Thereon. No claim against the City or the Housing Authority for damages for breach of contract or compensation for Extra work shall be made or asserted in any action or proceeding at law, or in equity, unless the Contractor shall have strictly complied with all the requirements relating to the giving of notice and of information with respect to such claims all as hereinbefore provided.”

Further, the parties agreed in Article 31 that no estoppel would operate against the Housing Authority:

“Article 31. No Estoppel. Neither the Housing Authority, the City nor any department, officer, agent or employees thereof, shall be bound, precluded or estopped by any determination, decision, approval, order, letter, payment or certificate made or given under or in connection with this Contract by the City, the Commissioner, the Housing Authority, or any officer, agent or employee of the City or Housing Authority, either before or after the final completion and acceptance of the Work and payment therefor: (1) from showing the true and correct classification, amount, quality or character of [27]

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Bluebook (online)
699 N.E.2d 368, 92 N.Y.2d 20, 677 N.Y.S.2d 9, 1998 N.Y. LEXIS 1424, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aha-general-construction-inc-v-new-york-city-housing-authority-ny-1998.