West-Fair Elec. Contractors Corp. v. Aetna Cas. & Sur. Co., 87 N.Y.2d 148 (1995)
Compliance with a municipal charter’s notice of claim provision is a condition precedent to litigation against the municipality, unless expressly waived or the contract’s dispute resolution procedures are plainly inconsistent with the charter.
Summary
West-Fair Electric Contractors sued the City of Syracuse to recover liquidated damages withheld for failure to complete work on time. West-Fair admitted non-compliance with the city charter’s notice of claim provision, arguing that the contract’s dispute resolution procedure sufficed. The Court of Appeals reversed the Appellate Division’s order, holding that absent an express waiver or contractual procedures plainly inconsistent with the charter, the notice of claim requirement remains a condition precedent to suit. The failure to serve the required notice necessitates dismissal of the action.
Facts
The City of Syracuse contracted with West-Fair Electric Contractors for improvements to a running track. The contract included a dispute resolution procedure. The City withheld a sum from West-Fair as liquidated damages because the work was not completed on time. West-Fair then sued the City to recover the withheld amount, bypassing the notice of claim provision in the Syracuse City Charter.
Procedural History
West-Fair commenced an action against the City of Syracuse to recover the withheld funds. The lower courts initially sided with West-Fair. The Court of Appeals reversed the order of the Appellate Division and dismissed the complaint, finding that West-Fair failed to comply with the notice of claim requirements of the Syracuse City Charter.
Issue(s)
Whether compliance with the notice of claim provision in the Syracuse City Charter is a condition precedent to commencing litigation against the City, even when the contract contains a dispute resolution procedure.
Holding
No, because absent an express waiver or contractual procedures plainly inconsistent with the charter, compliance with the notice of claim provision is a condition precedent to litigation against the City. The failure to serve a notice of claim requires dismissal of the action.
Court’s Reasoning
The Court of Appeals held that compliance with the Syracuse City Charter’s notice of claim clause is a condition precedent to commencing litigation against the City. The Court stated that this statutory provision will be deemed waived only where there is an express agreement that it is inapplicable, or where waiver may be implied because the parties have “set out detailed procedures which are ‘plainly inconsistent with those contained in that section.’” The Court found no express agreement to waive the notice of claim provision, and the procedures set out in the dispute resolution clause were not plainly inconsistent with the charter’s requirement for a notice of claim. Therefore, West-Fair’s failure to serve the notice required dismissal.