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BRINK'S INC. v. CITY OF N.Y.
December 29, 1981
BRINK'S INC., Plaintiff,
The CITY OF NEW YORK, Defendant; BRINK'S INC., Third-Party Plaintiff, v. John ADAMS, Anthony De Nardo, Trevor Fairweather, Richard Florio, James Gargiulo, Jorge Olivari and Michael Solomon, William J. Donovan, Francis Gitto, Ramon Hernandez, William McInerney, Anthony San Marco, Jose Rodriquez and Qonaar Corp., Third-Party Defendants
The opinion of the court was delivered by: WEINFELD
Plaintiff, Brink's Inc. ("Brink's"), commenced this action against defendant, The City of New York ("City"), to recover sums allegedly due under two contracts: one for the collection of parking meter revenues and the other for the transportation of bulk coin from the City depository to ATO Machine Corporation.
Both parties have moved for summary judgment under Rule 56 of the Federal Rules of Civil Procedure and Brink's requests any judgment in its favor be certified for immediate entry pursuant to Rule 54(b).
I. The Parking Meter Contract
The parties entered into the contract for the collection of parking meter revenue on March 21, 1978 and Brink's commenced performance in May 1978. Under this contract, three-person teams of Brink's employees collected coins from parking meters and delivered them to the City Department of Finance.
Approximately two years after performance had begun, on April 9, 1980, a number of Brink's employees were arrested for alleged thefts of parking meter monies, and on April 10, 1980 the City instructed Brink's to suspend work on the contract. By letter dated April 22, 1980, Mr. Harry S. Tischelman, the Commissioner of Finance, notified Brink's that the City was terminating the contract effective April 25, 1980 pursuant to Article 35(d) of the contract.
Brink's invoiced the City for $ 73,163.02 for services performed during the month of March 1980 and for $ 19,912.66 for services performed up to the date of termination, a total of $ 93,075.68, the sum it seeks to recover herein.
The City moves for summary judgment on the ground that Brink's claim is barred by the six-month limitation provision contained in the contract. The contract provides:
Article 39. Actions based on the Contract
Except as provided by Article 31,
no action shall lie or be maintained against the City upon any claim based upon this contract arising out of anything done in connection with this contract unless such action shall be commenced within six (6) months of the date of filing in the Office of Comptroller of the City of New York the certificate of final payment, or within six months after the effective date of termination of this contract for cause or for convenience. (Emphasis supplied.)
Under the terms of this provision, the six-month limitation provision begins to run upon either (1) the filing of a certificate of final payment, or (2) termination of the contract by the City "for cause or convenience." The parties agree that Tischelman's letter of April 22, 1980 terminated the contract "for convenience" and therefore only the latter part of this provision is applicable.
The City contends that Commissioner Tischelman's letter of April 22, 1980, effectively terminated the contract five days thereafter, on April 26, 1980;
accordingly, that under the six-month limitation period contained in Article 39, Brink's was required to commence any action for amounts owing under the contract by October 26, 1980. Since Brink's commenced this action on December 9, 1980, after the six-month contractual limitation period had expired, the City contends that it is barred.
Brink's makes three arguments in an attempt to avoid the consequences of its tardiness. First, Brink's argues that the six-month limitation period is invalid for it is unreasonably short. In John J. Kassner & Co. v. City of New York,
the New York Court of Appeals held that contractual shortening of limitations periods are enforceable provided that the prescribed period is "reasonable."
The parties may cut back on the Statute of Limitations by agreeing that any suit must be commenced within a shorter period than is prescribed by law. Such an agreement does not conflict with public policy but, in fact, "more effectively secures the end sought to be attained by the statute of limitations" (Ripley v. Aetna Ins. Co., 30 N.Y. 136, 163). Thus an agreement which modifies the Statute of Limitations by specifying a shorter, but reasonable, period within which to commence an action is enforceable (citation omitted) provided it is in writing (C.P.L.R. § 201).
Commenting upon the six-month limitation period found in the contract at issue in Kassner, a contract which, like that in the instant case was a municipal contract with the City of New York, the Court stated:
The contractual limitations period provision in this case is apparently a standard clause which, undoubtedly, was included to shorten the Statute of Limitations. (Citations omitted.) To that extent, of course, it would be enforceable.
The Court concludes that the six-month limitation period is not unreasonably short, and will be enforced.
Second, Brink's argues that the six-month period has not begun to run for there has not been a proper termination under the contract. The ...
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