On August 18, 2015, Justice Ramos of the New York County Commercial Division issued a decision in Madison Avenue Diamonds LLC v. KGK Jewelry LLC, 2015 NY Slip Op. 31585(U), holding that a defendant did not breach a contract by failing to perform an act by a contractual deadline because the General Construction Law extended the deadline for performance from a weekend to the next weekday.
In Madison Avenue Diamonds LLC, the plaintiff sued the defendant for breach of contract for failing timely to make a settlement payment, even though the payment was made on the first business day after the payment was due. The court granted the defendant summary judgment dismissing the plaintiff’s claim, explaining:
General Construction Law . . . § 25 provides in pertinent part:
Where a contract by its terms authorizes or requires the payment of money or the performance of a condition . . . within or before or after a period of time computed from a certain day, and such period of time ends on a Saturday, Sunday or public holiday, unless the contract expressly or impliedly indicates a different intent, such payment may be made or condition performed on the next succeeding business day . . . with the same force and effect as if made or performed in accordance with the terms of the contract.
. . .
The statute requires this Court to find that the contract impliedly indicates a different intent, i.e., that no matter what, performance must be made on the contract date and that time was of the essence.
(Internal quotations and citations omitted) (emphasis added). Because there was “no ‘time of the essence’ clause in the Agreement and nothing in the Agreement suggest[ing] such an intent,” and because “there is no particular significance to the date set for performance, such as the expiration of a stock option,” or indeed “any damages arising from the timing of” the payment on the first weekday after performance was due, the court held that GCL Section 25 applied and there had been no breach of the agreement.