On June 9, 2023, the Fourth Department issued a decision in Fields Enters. Inc. v. Bristol Harbour Vil. Assn., Inc., 2023 NY Slip Op. 03165, holding that a third-party beneficiary claim failed for lack of a showing of intent to benefit, explaining:
A third party may sue as a beneficiary on a contract made for its benefit. However, an intent to benefit the third party must be shown, and, absent such intent, the third party is merely an incidental beneficiary with no right to enforce the particular contracts. Thus, parties asserting third-party beneficiary rights under a contract must establish (1) the existence of a valid and binding contract between other parties, (2) that the contract was intended for [their] benefit and (3) that the benefit to [them] is sufficiently immediate, rather than incidental, to indicate the assumption by the contracting parties of a duty to compensate them if the benefit is lost. One is an intended beneficiary if one’s right to performance is appropriate to effectuate the intention of the parties to the contract and either the performance will satisfy a money debt obligation of the promisee to the beneficiary or the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.
Here, plaintiffs established on their motion that BHVA does not have standing to enforce the 1990 Stipulation as a third-party beneficiary. It is undisputed that there was a valid contract between BHRA, which owned the marina and other portions of the Village, CCCL’s officers and members of its steering committee, and the individual adjoining landowners. BHRA intended to give CCCL and the adjacent landowners the benefit of the promised performance by limiting the future number of people using the marina to only those who were Village residents. There is no indication in the 1990 Stipulation that BHRA also intended to give Village residents the benefit of the promised performance or assumed a duty to make reparations to BHVA, or the Village residents, if the alleged benefit was lost. Indeed, in the 1990 Stipulation, BHRA agreed to limit the rights of Village residents for the benefit of CCCL and the adjacent landowners. Thus, plaintiffs established that BHVA is at best merely an incidental beneficiary who may derive a benefit from the performance of a contract though it is neither the promisee nor the one to whom performance is to be rendered.
(Internal quotations and citations omitted).