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PORT AUTH. OF NEW YORK & NEW JERSEY v. ALLIED CORP

March 29, 1995

PORT AUTHORITY OF NEW YORK AND NEW JERSEY, et ano., Plaintiffs, against ALLIED CORPORATION, et al., Defendants.


The opinion of the court was delivered by: BRIEANT

 Brieant, J.

 In June of 1987 plaintiffs commenced this action against numerous companies that mined, manufactured, sold or installed various asbestos products, claimed to have been installed between 1920 and 1975 in buildings owned or leased by plaintiffs.

 On June 27, 1994 plaintiffs filed a Second Amended Complaint, alleging claims based on (1) negligence, (2) strict tort liability, (3) indemnification, (4) breach of express warranties, (5) breach of implied warranties, (6) fraud and misrepresentation, and (7) violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"). By motion filed August 4, 1994, defendants moved to dismiss plaintiffs' fourth and fifth claims for breach of express and implied warranties of merchantability and fitness for use. The Court heard oral argument on December 2, 1994.

 To support dismissal of the warranty claims defendants argue that the claims are barred by the U.C.C. § 2-725 four year statute of limitations governing actions for breach of contract for the sale of goods, and that the amendment to the CPLR, commonly called the "Toxic Tort Revival Act", 1986 N.Y. Laws ch. 682, § 4, does not resurrect these otherwise time barred contract claims.

 Plaintiffs assert that the warranty claims are not barred by the four year statute of limitations because of the exception in U.C.C. § 2-725 (2) for actions based on breach of an explicit warranty for future performance. Alternatively, plaintiffs claim the benefit of the Toxic Tort Revival Act. Lastly, plaintiffs contend defendants are equitably estopped from relying on the statute of limitations defense, because of their active concealment of the hazards of asbestos which prevented plaintiff from discovering the warranty breach within the four year period. Plaintiffs assert that their allegations of active concealment raise a triable issue.

 Dismissal of the fourth and fifth claims will not dispose of this case and does little toward ultimate resolution of the parties' dispute, because there remain outstanding claims for strict tort liability, negligence, indemnification, fraud and misrepresentation, and RICO. However, dismissal might narrow the issues for trial, and our trial jury should not be burdened by considering inapplicable and duplicative legal theories. The Court concludes that the motion should be granted.

 By its very nature an implied warranty cannot be explicit, and thus cannot be saved by the § 2-725 (2) exception for explicit warranties as to future performance. Plaintiffs have submitted nothing which qualifies as an explicit warranty as contemplated by the U.C.C. § 2-725 (2).

 U.C.C. § 2-725 provides in relevant part:

 
(1) An action for breach of any contract for sale must be commenced within four years after the cause of action has accrued...
 
(2) A cause of action accrues when the breach occurs, regardless of the aggrieved party's lack of knowledge of the breach. A breach of warranty occurs when tender of delivery is made, except that where a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance the cause of action accrues when the breach is or should have been discovered.

 New York courts interpreting this section have held that it applies to breach of warranty claims involving the installation of asbestos products in buildings. 888 7th Avenue Assocs. Ltd. Partnership v. AAER Sprayed Insulations, Inc., 199 A.D.2d 50, 605 N.Y.S.2d 25 (1st Dept. 1993); Glod v. Ashland Chemical Co., 145 Misc. 2d 200, 546 N.Y.S.2d 748 (Sup.Ct., Oswego County 1989) (involving toxic chemicals causing asthma), aff'd as modified on other grounds, 168 A.D.2d 954, 564 N.Y.S.2d 905 (4th Dept. 1990); See also Heller v. U.S. Suzuki Motor Co., 64 N.Y.2d 407, 411, 488 N.Y.S.2d 132, 477 N.E.2d 434 (1985).

 In this case, any breach of warranty claims for asbestos products installed or tendered on or before June 23, 1983 are time barred. It is undisputed that the last tender of delivery of defendants' asbestos products was before June of 1983.

 Plaintiffs' reliance on the "future performance" exception of U.C.C. § 2-725 (2) is ineffective because any such warranty relied on must be explicit. Logically, implied warranties cannot explicitly extend to future performance. Holdridge v. Heyer-Schulte Corp., 440 F. Supp. 1088, 1103 (N.D.N.Y. 1977). In H. Sand & Co. Inc. v. Airtemp Corp., 738 F. Supp. 760 (S.D.N.Y. 1990), aff'd in part, rev'd in part on other grounds, 934 F.2d 450 (2d Cir. 1991), the court held that "the term 'explicit' has been explained as plain language which is distinctly stated, clear and unequivocal to the point that there is no doubt as to its meaning." 738 F. Supp. at 770. ...


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