Deutsche Bank National Trust Co. v. Flagstar Capital Markets

The Court of Appeals held that Plaintiff’s breach of contract action, which concerned the interplay between the freedom to contract and New York public policy, was correctly dismissed as untimely because no substantive condition precedent was created and, to the extent the parties intended to postpone the commencement of the limitations period, their attempt to do so was inconsistent with New York law and public policy. In ACE Sec. Corp., Home Equity Loan Trust Series 2006, SL2 v. DB Structured Prods., Inc., 26 NY3d 581 (2015), the Court of Appeals held that a cause of action for breach of representations and warranties contained within a residential mortgage-backed securities contract accrued when the contract was executed. On appeal, Plaintiff argued that contractual language different from the language at issue in ACE and that an accrual clause either created a substantive condition precedent to suit or expressed the clear intent of the parties to delay commencement of the statutory limitations period until certain specified events had occurred. The Appellate Division affirmed. The Court of Appeals affirmed, holding (1) nothing in the accrual clause created a substantive condition precedent; and (2) the parties may not postpone accrual in the manner attempted in this case consistent with New York law and public policy. View "Deutsche Bank National Trust Co. v. Flagstar Capital Markets" on Justia Law