Logourl black

City of Rye v. Public Serv. Mut. Ins. Co.

Court of Appeals of New York
315 N.E.2d 458 (1974)


Facts

The City of Rye (Rye) (plaintiff) hired Public Service Mutual Insurance Company (Public Service) (defendant), developers, to construct six luxury apartment buildings. The contract between Rye and Public Service required Public Service to post a $100,000 bond and to pay $200 per day for each day after April 1, 1971 that the six buildings were not completed. Rye had no statutory authority for imposing this bond on Public Service. Due to changes in the market, Public Service was unable to obtain the necessary financing to complete the buildings on time. After the buildings were 500 days late, Rye brought suit in New York state court against Public Service seeking the full value of the bond. The trial court denied Rye’s motion for summary judgment, and the appellate court affirmed. The appellate court concluded that the bond was penal in nature and thus was unenforceable. Rye appealed.

Rule of Law

The rule of law is the black letter law upon which the court rested its decision. To access this section, start your 7-day free trial of Quimbee for Law Students.

Issue

The issue section includes the dispositive legal issue in the case phrased as a question. To access this section, start your 7-day free trial of Quimbee for Law Students.

Holding and Reasoning (Breitel, C.J.)

The holding and reasoning section includes:

  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

To access this section, start your 7-day free trial of Quimbee for Law Students.

Here's why 85,000 law students rely on our case briefs:

  • Reliable - written by law professors and practitioners not other law students.
  • The right length and amount of information - includes the facts, issue, rule of law, holding and reasoning, and any concurrences and dissents.
  • Access in your class - works on your mobile and tablet.
  • 11,925 briefs - keyed to 159 casebooks.
  • Uniform format for every case brief.
  • Written in plain English - not in legalese and not just repeating the court's language.
  • Massive library of related video lessons - and practice questions.
  • Ability to tag case briefs in an outlining tool.
  • Top-notch customer support.
Start Your Free Trial Now