On March 29, 2022, Justice Borrok of the New York County Commercial Division issued a decision in Board of Mgrs. of the St. Tropez Condominium v. JMA Consultants, Inc., 2022 NY Slip Op. 31045(U), upholding a third-party beneficiary contract claim, explaining:
Although QBC did not enter into a contract with JMA, JMA asserts breach of contract and contractual indemnification claims against QBC as an intended beneficiary of the Contract with the Board.
It is well settled that an intended beneficiary of a contract may maintain a third-party action against a contracting party by establishing (1) the existence of a valid and binding contract between other parties, (2) that the contract was intended for his benefit and (3) that the benefit to him is sufficiently immediate, rather than incidental.
QBC’s assertion that JMA was not an intended beneficiary of the Contract is not true. The language in the Rider with regard to both QBC’s obligation to maintain insurance coverage on behalf of JMA and indemnify JMA makes it very clear that JMA was an intended beneficiary of the Contract. Specifically, the requirements that QBC (1) maintain an insurance policy for the protection and benefit of the Architect and (2) indemnify the Architect regardless of whether such claims, damages, costs, expenses, or losses are caused in part by a party indemnified hereunder unequivocally express that JMA was an intended beneficiary of the
(Internal quotations and citations omitted).
Contract. As pled in the amended third-party complaint, JMA’ s claims for breach of contract and contractual indemnification are sufficient to survive QBC’s motion to dismiss because there is no dispute that the Contract was valid, and JMA was an intended beneficiary of the insurance and indemnification clauses of the Contract.