Court Opinion

ID: 8679615
Source: CourtListenerOpinion
Date Created: 2022-11-25 04:21:10.644855+00
Date Added: 2024-06-11T16:57:22.491062
License: Public Domain

SUMMARY ORDER
Plaintiff-Appellant Lehman XS Trust (“Lehman”) appeals from the district court’s order dismissing its claims for breach of contract against Defendant-Ap-pellee Greenpoint Mortgage Funding, Inc. (“Greenpoint”) on statute of limitations grounds. The claims arose from Green-point’s alleged breach of its contractual obligations, as memorialized in the parties’ Flow Mortgage Loan Purchase and Warranties Agreement (“MLPA”), to repurchase mortgage loans that allegedly violated certain representations and warranties. We assume the parties’ familiarity with the underlying facts and the procedural history of the case.
On appeal, Lehman argues that its claims were timely because: (1) under the MLPA’s “accrual provision,” the claims did not accrue until Greenpoint’s opportunity to cure the breach or repurchase the loans had expired; and (2) the MLPA’s “repurchase” provision gave rise to a separate breach each time Greenpoint failed to repurchase a breaching loan. These arguments are unavailing in light of recent decisions of the New York Court of Appeals, ACE Secs. Corp. v. DB Structured Prods., Inc., 26 N.Y.3d 581, 15 N.Y.S.3d 716, 36 N.E.3d 623 (2015), and this Court, Deutsche Bank National Trust Co. v. Quicken Loans, Inc., 810 F.3d 861 (2d Cir.2015).
We review de novo a district court’s grant of a motion to dismiss, including its application of the pertinent statute of limitations and its interpretation of contractual *16terms. Id. at 865. When sitting in diversity jurisdiction and reviewing New York state law claims, we must apply “the law of New York as interpreted by the New York Court of Appeals.” Id. (quoting Licci ex rel. Licci v. Lebanese Canadian Bank, SAL, 739 F.3d 45, 48 (2d Cir.2013) (per curiam)).
Under New York law, the six-year limitations period on claims for breach of contract generally runs from the time the contract was breached. N.Y. C.P.L.R. 203(a), 213(2); see also Ely-Cruikshank Co. v. Bank of Montreal, 81 N.Y.2d 399, 402, 599 N.Y.S.2d 501, 615 N.E.2d 985 (1993). Where “a demand is necessary to entitle a person to commence an action,” the cause of action accrues “when the right to make the demand is complete.... ” N.Y. C.P.L.R. 206(a). Accordingly, “[a] cause of action for breach of contractual representations and warranties that guarantee certain facts as of a certain date — but do not guarantee future performance — accrues on the date those representations and warranties become effective.” Quicken Loans, 810 F.3d at 865 (citing ACE, 25 N.Y.3d at 596, 15 N.Y.S.3d 716, 36 N.E.3d 623). In this case, the representations and warranties were made at the time the MLPA was closed in 2006, and Lehman was entitled to demand the contractual remedy — cure or repurchase of the allegedly defective loans — at that time.1 By the time Lehman filed suit in 2013, more than six years had passed since Lehman was first entitled to demand that Greenpoint cure or repurchase the breaching loans. Lehman’s claims are, therefore, time-barred.
The repurchase provision of the parties’ MLPA does not delay accrual of the statute of limitations, because it does not create a substantive condition precedent to suit. See Quicken Loans, 810 F.3d at 866 (noting that New York courts “distinguish between substantive demands and procedural demands” for statute of limitations purposes (quoting Cont’l Cas. Co. v. Stronghold Ins. Co., 77 F.3d 16, 21 (2d Cir.1996))). Rather, the contractual demand condition to cure or repurchase merely prescribes the mechanism by which the purchaser seeks a remedy for a preexisting wrong. See id. at 867 (stating with respect to similar repurchase provision that “performance (or nonperformance) of the contract is not contingent on [the party’s] demand; the [representations and warranties] were true or false — either performed or not — at the moment they were made”).
We have considered Appellant’s remaining arguments and conclude that they are without merit. We therefore AFFIRM the judgment of the district court.

. The language of the accrual provision in this case, which states that a claim for breach of representations or warranties accrues upon "discovery of such breach by the Purchaser or notice thereof by the Seller to the Purchaser, [ ] failures by the Seller to cure such Breach or repurchase such Mortgage Loan ... and [ ] demand upon the Seller by the Purchaser for compliance with th[e] Agreement,” is identical in all material respects — for purposes of our inquiry here — to the accrual provision at issue in Quicken Loans. J.A. 139; see Quicken Loans, 810 F.3d at 864.