Justice John Leventhal
In July 2003 QK Healthcare (QKH) bought 36,000 units of a drug from InSource Inc. In August 2003, it bought 20,000 units from Henry Schein Inc. QKH’s July 2010 complaint sought damages for anticipatory repudiation of contract after the firms’ 2005 refusalcontrary to their policies and industry practiceto accept returns of unsold units that expired or were about to expire. To mitigate damages, QKH returned 29,792 units to the drug’s maker at a "reduced" credit. Supreme Court denied dismissal, finding QKH’s complaint timely within the six year limitation of Civil Practice Law and Rules 2131 and the four-year limitation of Uniform Commercial Code 2-725(1). Partly reversing, Second Department held that while QKH’s complaint stated a cause of action to recover damages for anticipatory repudiation, it was time-barred as against InSource, which was contractually obligated to accept returns only until June 2006, and QKH commenced action more than four years thereafter. Because the complaint involved the sale of goods, the UCC’s four-year limitation statute applied. As in Cary Oil Co. v. MG Ref. & Mktg. Inc., the statute of limitations on QKH’s anticipatory repudiation cause of action did not automatically begin to run at the point of repudiation.
