Although parties may contractually agree to undertake a separate obligation, the breach of which does not arise until some future date, the repurchase obligation undertaken by DBSP does not fit this description. To support its contrary position, the Trust relies on our decision in Bulova Watch Co. v Celotex Corp. (46 NY2d 606 ), where we considered whether the separate repair clause in a contract for the sale of a roof constituted a future promise of performance, the breach of which created a cause of action. The separate clause the seller included in that contract was a “20-Year Guaranty Bond,” which “expressly guaranteed that [the seller] would ‘at its own expense make any repairs . . . that may become necessary to maintain said Roof’ ” (id. at 608-609).
I stored that the verify “embod[ied] an agreement not the same as new contract available roofing product,” the newest breach where triggered brand new statute of limits anew (id. within 610). It was therefore as the defendant for the Bulova Observe “didn’t merely guarantee the condition otherwise performance of your services and products, but wanted to manage a help” (id. from the 612). One service are brand new separate and you can line of pledge to correct an effective faulty roof-a critical element of the fresh parties’ offer and “a unique, independent and additional bonus to shop for” the fresh new defendant’s equipment (id. during the 611). Correctly, the fresh new “arrangements thinking about characteristics . . . was in fact susceptible payday loan Ethelsville to a half a dozen-year statute . . . running age occasioned when a breach of the duty to fix the fresh new fused roof happened” (id.).
DBSP’s eliminate otherwise repurchase duty was the new Trust’s remedy for a beneficial violation ones representations and you may warranties, perhaps not a promise of your own loans’ upcoming show
The latest corrective condition during the Bulova View explicitly guaranteed future results of brand new rooftop and undertook a promise to correct new roof if it did not fulfill the seller’s make certain. They [*7] portrayed and you will justified particular details about the latest loans’ features since , in the event that MLPA and you will PSA have been performed, and you will explicitly reported that the individuals representations and you will warranties don’t survive the latest closure big date. Rather than the fresh new separate be certain that in Bulova Observe, DBSP’s lose otherwise repurchase duty couldn’t relatively be looked at because the a distinct hope of upcoming overall performance. It had been dependent on, and even derivative of, DBSP’s representations and you may warranties, which didn’t endure the brand new closing and you can were breached, if, thereon date. [FN3]
Indeed, little from the package given that get rid of otherwise repurchase responsibility create last for the life of one’s money
And it makes sense that DBSP, as sponsor and seller, would not guarantee future performance of the mortgage loans, which might default 10 or 20 years after issuance for reasons entirely unrelated to the sponsor’s representations and warranties. The sponsor merely warrants certain characteristics of the loans, and promises that if those warranties and representations are materially false, it will cure or repurchase the non-conforming loans within the same statutory period in which remedies for breach of contract (i.e., rescission and expectation damages) could have been sought. [FN4]
If the cure or repurchase obligation did not exist, the Trust’s only recourse would have been to bring an action against DBSP for breach of the representations and warranties. That action could only have been brought within six years of the date of contract execution. The cure or repurchase obligation is an alternative remedy, or recourse, for the Trust, but the underlying act the Trust complains of is the same: the quality of the loans and their conformity with the representations and warranties. The Trust argues, in effect, that the cure or repurchase obligation transformed a standard breach of contract remedy, i.e. damages, into one that lasted for the life of the investment-decades past the statutory period. But nothing in the parties’ agreement evidences such an intent. Historically, we have been
