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  • Writer's pictureGeorge Marco

COURTS ROUTINELY UPHOLD NOTICE OF CLAIM AND NO ESTOPPEL PROVISIONS IN PUBLIC WORKS CONTRACTS

In January 2024, a trial court in New York County dismissed a contractor’s claim for extra concrete work against the New York City Housing Authority (“NYCHA”) due to its failure to file a contractual notice of claim within twenty (20) days of accrual of its extra work claim as required under Section 33 of NYCHA’s contract.  Corbex Inc. v. New York City Housing Authority, 2024 NY Slip Op 30292 (N.Y. County 2024).


In its defense, Corbex argued that NYCHA should be estopped from raising the notice of claim provision because it had previously told Corbex at a meeting that it would be compensated for this extra work.  However, the court rejected this argument finding instead that there was nothing in writing from NYCHA promising that it would be paid and that, in any event, the contract contained a no estoppel provision which provides that “no act done or permitted to be done by any member, officer, agent or employee of the Authority at any time shall be deemed to be a waiver of any provisions of the Contract”. 

 

Comment:

 

The 20-day notice of claim requirement under Section 33 of NYCHA’s standard form contract has been routinely upheld by the courts in New York, resulting in the dismissal of countless complaints for unpaid extra work.  Moreover, because of the contract’s no estoppel provision a contractor should never rely upon oral or even written assurances of payment for extra work short of a signed written change order.  When performing work for NYCHA, the SCA or other public agencies in New York, a contractor must be aware of the various statutes and contract provisions that require the filing of notices of claims prior to filing a lawsuit, since failing to comply will most likely result in the dismissal of your complaint, regardless of the merit of your extra work or other claims.

 

About the author: George Marco is an attorney practicing in the field of construction law. He also holds a Bachelor of Science in Mechanical Engineering and was previously employed as a Project Manager for a public improvement contractor.


If you would like more information regarding this topic or any other related to construction law please contact George Marco at george@gmarcolaw.com or call (516) 464-2320.


Disclaimer: This article is for informational purposes only and not intended to serve as legal counsel.



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