Syracuse Supply Co. v. Seaboard Surety Co.

Appellate Division of the Supreme Court of New York

Syracuse Supply Co. v. Seaboard Surety Co.

167 A.D.2d 830, 561 N.Y.S.2d 865, 1990 N.Y. App. Div. LEXIS 14366

CourtAppellate Division of the Supreme Court of the State of New York

DecidedNovember 16, 1990

StatusPublished

Cited by4 cases

This text of 167 A.D.2d 830 (Syracuse Supply Co. v. Seaboard Surety Co.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Syracuse Supply Co. v. Seaboard Surety Co., 167 A.D.2d 830, 561 N.Y.S.2d 865, 1990 N.Y. App. Div. LEXIS 14366 (N.Y. Ct. App. 1990).

Pincite

Opinion

Judgment unanimously reversed on the law without costs, motion denied and cross motion granted. Memorandum: We reverse the judgment insofar as appealed from and grant plaintiff supplier’s cross motion for summary judgment on the cause of action asserted against the surety, Seaboard Surety Company (Seaboard). Liability on a payment bond required pursuant to State Finance Law § 137 was not intended to be contingent upon the existence of a lienable fund (Chittenden Lbr. Co. v Silberblatt & Lasker, 288 NY 396, 404). "The 'benefits’ which the Legislature, by the enactment of section 137, intended to grant to laborers and materialmen, are found in the guarantee of payment afforded by the bond in those instances where there is no fund, or an insufficient fund, due the contractor or subcontractor on a State public improvement, against which the enforcement of valid and existing liens may lead to the payment thereof’ (Chittenden Lbr. Co. v Silberblatt & Lasker, supra, at 404). Section 137 supplements those provisions of the Lien Law and Labor Law which facilitate payment for labor and material furnished for a municipal public improvement. The statutory construction advanced by Seaboard must be rejected because it would provide to those who supply labor and materials on public contracts no greater assurance of payment than they had before the enactment of the statute. Under the circumstances of this case, "[t]he remedy on the payment bond is in the nature of a third-party beneficiary recovery. It is dependent neither on the existence of a lien fund or a Lien Law trust fund for its utilization or enforcement” (Tri-City Elec. Co. v People, 96 AD2d 146, 150, affd 63 NY2d 969). (Appeal from judgment of Supreme Court, Onondaga County, Hayes, J.—summary judgment.) Present—-Callahan, J. P., Denman, Green, Balio and Davis, JJ.

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Judgment unanimously reversed on the law without costs, motion denied and cross motion granted. Memorandum: We reverse the judgment insofar as appealed from and grant plaintiff supplier’s cross motion for summary judgment on the cause of action asserted against the surety, Seaboard Surety Company (Seaboard). Liability on a payment bond required pursuant to State Finance Law § 137 was not intended to be contingent upon the existence of a lienable fund (Chittenden Lbr. Co. v Silberblatt & Lasker, 288 NY 396, 404). "The 'benefits’ which the Legislature, by the enactment of section 137, intended to grant to laborers and materialmen, are found in the guarantee of payment afforded by the bond in those instances where there is no fund, or an insufficient fund, due the contractor or subcontractor on a State public improvement, against which the enforcement of valid and existing liens may lead to the payment thereof’ (Chittenden Lbr. Co. v Silberblatt & Lasker, supra, at 404). Section 137 supplements those provisions of the Lien Law and Labor Law which facilitate payment for labor and material furnished for a municipal public improvement. The statutory construction advanced by Seaboard must be rejected because it would provide to those who supply labor and materials on public contracts no greater assurance of payment than they had before the enactment of the statute. Under the circumstances of this case, "[t]he remedy on the payment bond is in the nature of a third-party beneficiary recovery. It is dependent neither on the existence of a lien fund or a Lien Law trust fund for its utilization or enforcement” (Tri-City Elec. Co. v People, 96 AD2d 146, 150, affd 63 NY2d 969). (Appeal from judgment of Supreme Court, Onondaga County, Hayes, J.—summary judgment.) Present—-Callahan, J. P., Denman, Green, Balio and Davis, JJ.

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Bluebook (online)

167 A.D.2d 830, 561 N.Y.S.2d 865, 1990 N.Y. App. Div. LEXIS 14366, Counsel Stack Legal Research, https://law.counselstack.com/opinion/syracuse-supply-co-v-seaboard-surety-co-nyappdiv-1990.

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