On November 8, 2023, the Second Department issued a decision in Five Star Elec. Corp. v. Skanska USA Bldg., Inc., 2023 NY Slip Op. 05588, holding that a claim for failure to pay did not accrue until the condition requiring payment was met, explaining:
In moving to dismiss a cause of action pursuant to CPLR 3211(a)(5) as barred by the applicable statute of limitations, a defendant bears the initial burden of demonstrating, prima facie, that the time within which to commence the action has expired. The burden then shifts to the plaintiff to raise an issue of fact as to whether the statute of limitations was tolled or was otherwise inapplicable, or whether it actually commenced the action within the applicable limitations period.
The breach of contract cause of action is governed by the terms of the subject contract and is subject to the six-year statute of limitations in CPLR 213(2). A breach of contract cause of action accrues at, and the statute of limitations begins to run from, the time of the breach. As a general rule, when the right to final payment is subject to a condition, the obligation to pay arises and the cause of action accrues, only when the condition has been fulfilled.
Here, the subcontract makes explicit that payment from the SCA to Skanska was a condition precedent to Skanska’s payment to the plaintiff. In opposition to the defendant’s motion, the plaintiff submitted evidence that, as late as January 2020, the SCA was still reviewing the plaintiff’s requests for payment and had not yet made payment to Skanska for the benefit of the plaintiff on account of those requests for payment. Accordingly, the Supreme Court erred in granting dismissal of the cause of action alleging breach of contract on the ground that it was time-barred.
(Internal quotations and citations omitted).