Dormitory Auth. of N.Y. v. Samson Constr. Co.
30 N.Y.3d 704
| Court for the Trial of Impeach... | 2018Background
- DASNY contracted with Perkins Eastman to design and supervise construction of a forensic biology laboratory for OCME; DASNY was project manager for the City.
- Perkins' contract obliged it to indemnify DASNY and the "Client" and to cover extra costs from design errors; it did not expressly name the City as an intended third-party beneficiary.
- DASNY separately contracted with Samson, and that contract expressly made the City an intended third-party beneficiary.
- Excavation and foundation work (performed by Samson) failed, causing settlement of an adjacent building, damage to surrounding infrastructure, >18-month delay and ~$37 million in additional costs.
- Plaintiffs sued Samson and later added Perkins, asserting breach of contract (by DASNY) and negligence/professional malpractice (by both DASNY and the City as to Perkins); Perkins moved for summary judgment.
- Supreme Court granted Perkins summary judgment dismissing City claims and DASNY's negligence claim; Appellate Division reversed as to City beneficiary status and denied dismissal of DASNY's negligence claim; Court of Appeals granted review.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether City is an intended third-party beneficiary of DASNY–Perkins contract | City/DASNY: contract performance was for City's benefit; DASNY and City were functionally connected and City retained control/approval rights, supporting beneficiary status | Perkins: contract lacks express language conferring enforcement rights on City; City is an incidental beneficiary like typical end-users | City is not an intended third-party beneficiary; summary judgment for Perkins affirmed on City claims |
| Whether DASNY's negligence (professional malpractice) claim is duplicative of its breach of contract claim | DASNY: architects owe independent professional duty; malpractice and contract claims may both proceed (no double recovery) | Perkins: negligence allegations merely restate contractual obligations and seek the same damages; tort claim duplicates contract claim and should be dismissed | DASNY's negligence claim is duplicative of its contract claim and must be dismissed on summary judgment |
Key Cases Cited
- Port Chester Elec. Constr. Corp. v. Atlas, 40 N.Y.2d 652 (establishes requirement of intent to benefit third party for enforcement)
- Fourth Ocean Putnam Corp. v. Interstate Wrecking Co., 66 N.Y.2d 38 (recognizes two circumstances where third party may enforce contract)
- Clark‑Fitzpatrick, Inc. v. Long Is. R.R. Co., 70 N.Y.2d 382 (simple breach of contract is not a tort absent independent legal duty)
- Sommer v. Federal Signal Corp., 79 N.Y.2d 540 (professionals may owe an independent tort duty; factors for when tort claim may lie)
- Santulli v. Englert, Reilly & McHugh, 78 N.Y.2d 700 (professional malpractice claim may coexist with breach of contract claim)
- Sears, Roebuck & Co. v. Enco Assoc., 43 N.Y.2d 389 (owner may seek contract or tort remedies against architects; scope of admissible evidence similar)
- Brushton‑Moira Cent. School Dist. v. Thomas Assoc., 91 N.Y.2d 256 (clarifies remedy and damages principles where professional's duties arise contractually)
- Robins v. Finestone, 308 N.Y. 543 (older precedent on professional liability principles)