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Scott E. Mollen

Construction—Utility Interference Work—Contractor Sued Utility to Recover Costs of Construction—Utility’s Motion to Dismiss Denied—Parties Waived Arbitration Pursuant to “Section U” Procedure

This action was commenced by a general contractor (contractor) and involved a lawsuit involving “capital municipal work with New York City and its agencies,” against “a private utility company that owns and/or operates surface and subsurface utility facilities within New York City,” and a subsidiary thereof (Utility). The contractor sued the Utility to recover costs for construction. The Utility moved to dismiss an amended complaint, pursuant to CPLR §§3211(a)(1) and (a)(7). The court denied the motion to dismiss.

The contractor and the Utility had signed an agreement with a non-party New York City agency (agency), pursuant to which the Utility agreed “to cooperate with and compensate the contractors working on [agency] projects for moving, protecting, and securing (Utility’s) existing utility facilities that impact [agency’s] work.” The contractor and the Utility had also entered into an agreement with the agency for construction of a culvert. The contractor’s work “interfered with…underground… utility lines owned by [Utility], requiring [contractor] to move, protect, or secure those facilities” (interference work).

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