You are here: / / “Notwithstanding Clause” in Contract Insulated Town from Liability...
,

“Notwithstanding Clause” in Contract Insulated Town from Liability for Bond Payments Re: a Waste Disposal Facility

The Second Department determined Supreme Court properly resolved conflicting contract provisions by reference to General Municipal Law 109-b (2) which governs installment contracts entered into by municipalities.  The contract concerned the operation of a waste disposal facility which closed before the bonds used to fund it were paid off.  The insurance company sought payment from the town’s sanitary district. The court held that the clauses in the contract which insulated the district from liability for the payments (if the funds were not appropriated) were enforecable:

Consistent with the requirements of General Municipal Law § 109-b(2)(f), which applies to installment contracts entered into by municipalities, section 24 of the lease between the District and NCIDA states that:

“Notwithstanding any other provision of this Agreement, (i) this Agreement shall be deemed executory only to the extent of the moneys budgeted and appropriated and available for the purpose of this Agreement, and no liability on account thereof shall be incurred by the District beyond the amount of such moneys, and (ii) it is understood that neither this Agreement nor any representation by any public employee or officer creates any legal or moral obligation to request, budget, appropriate or make available moneys for the purpose of this Agreement.”

Such clauses are intended to be utilized as a shield against the imprudent use of taxpayers’ dollars, and not as a sword to divorce the State, for purposes of its own convenience, from a contract fairly entered into and honestly performed … . Nevertheless, “even though a municipality may possess sufficient funds to satisfy a particular obligation, such funds cannot be deemed available’ if the expenditure thereof would be improvident” … .

Here, although in its lease with the NCIDA the District promised to seek appropriations sufficient to make the lease payments, the lease also repeatedly stated that the District’s liability for payments was conditioned upon the appropriation of funds. Indeed, the District’s promise to seek appropriations was tempered by the provision stating that it was required to do so only “subject to the provisions of Section 24 hereof.” Since “trumping language such as a notwithstanding’ provision controls over any contrary language’ in a contract,” the Supreme Court properly relied upon this section as the basis for its determination … . Frankenmuth Mut Ins v Waste Mgt of NY LLC, 2014 NY Slip Op 07624, 2nd Dept 11-12-14

 

You might also like
Late Notice of Claim Can Be Allowed Even in Absence of Reasonable Excuse Where Defendants Had Actual Notice
NO CAUSAL CONNECTION BETWEEN FATHER’S MENTAL ILLNESS AND ACTUAL OR POTENTIAL HARM TO THE CHILD, NEGLECT FINDING VACATED (SECOND DEPT).
DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT IN THIS SLIP AND FALL CASE WAS PREMATURE AND SHOULD HAVE BEEN DENIED; CRITERIA EXPLAINED (SECOND DEPT).
FAILURE TO FOLLOW STATUTORY SENTENCING PROCEDURES FOR A PERSISTENT FELONY OFFENDER RENDERED SENTENCE “ILLEGALLY IMPOSED.”
RADIOLOGIST WAS NOT QUALIFIED TO EXPRESS AN OPINION ON THE PROXIMATE CAUSE OF THE DEFORMITY WHICH WAS ALLEGED TO HAVE RESULTED FROM A FAILURE TO DIAGNOSE A FRACTURE. 
Abuse Finding, Based Upon an Unsatisfactory Explanation for the Child’s Injury, Reversed Based Upon the Testimony of Petitioner’s Medical Witness Who Stated the Injury Could Have Been Caused by a Fall and Described the Child as Basically Asymptomatic and Happy at the Hospital
COMMON CARRIER DID NOT HAVE A DUTY TO KEEP SIDEWALK CLEAR OF ICE AND SNOW BECAUSE THE SIDEWALK SERVED AS INGRESS AND EGRESS FOR SEVERAL COMMON CARRIERS, NOT SOLELY DEFENDANT COMMON CARRIER.
THE DEFAULTING DEFENDANT WHOSE ANSWER HAD BEEN STRUCK WAS NOT ENTITLED TO FURTHER DISCOVERY PRIOR TO THE INQUEST ON DAMAGES (SECOND DEPT).

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy

Plaintiff Entitled to Damages from the City—Plaintiff Had a “Special... Question of Fact Raised About Defendant’s Comparative Negligence in Striking...