J.P. Doumak, Inc. v. Westgate Financial Corp.

Andrias, J. (dissenting).

I respectfully dissent and would affirm the grant of summary judgment to plaintiff.

We all agree, contrary to defendant’s assertion, that the agreement at issue, although denominated a guaranty, is a letter of credit because no extrinsic evidence is necessary to determine the parties’ obligations and by its very terms, defendant was primarily responsible for payment, which was to be made upon presentation of the contractually prescribed documentation, regardless of whether the underlying transaction had been satisfactorily performed (see New Jersey Bank v Palladino, 77 NJ 33, 52, 389 A2d 454, 464 [1978] [dissenting op]).

In light of defendant’s failure for more than three months to notify plaintiff of its rejection of the documentation proffered by plaintiff in support of its request for payment, defendant may not avoid liability under the agreement by claiming that plaintiff failed to make timely written demand for payment or that the demand was otherwise not in accordance with the agreement (see Alaska Textile Co., Inc. v Chase Manhattan Bank, N.A., 982 F2d 813, 816 [1992]).

In any event, insofar as defendant failed to allege with particularity plaintiff’s noncompliance with the certificate of inspection condition precedent to payment under the subject agreement and failed to interpose any affirmative defenses to that effect, the certificate of inspection condition precedent defense was waived (see City of New York v Delafield 246 Corp., 236 AD2d 11, 22, resettled in part 244 AD2d 272 [1997], lv denied 91 NY2d 811 [1998]). Although defendant’s answer did raise the issue of plaintiffs alleged failure to comply with the condition precedent of timely written demand for payment, the evidence as a whole establishes that such condition was satisfied.

Buckley, P.J., and Rosenberger, J., concur with Friedman, J.; Nardelli and Andrias, JJ., dissent in a separate opinion by Andrias, J.

Judgment, Supreme Court, New York County, entered December 4, 2001, reversed, on the law, without costs, plaintiffs cross motion for summary judgment denied, and defendant’s motion for summary judgment dismissing the complaint granted. The Clerk is directed to enter judgment in favor of defendant dismissing the complaint. Appeal from order, same court, entered December 3, 2001, dismissed, without costs, as subsumed in the appeal from the judgment.