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S.D.I. Corp. v. Fireman’s Fund Ins. Companies – Case Brief Summary (New York)

In S.D.I. Corp. v. Fireman's Fund Ins. Companies, 208 AD2d 706, 708, 617 N.Y.S.2d 790 [2d Dept 1993] plaintiff-subcontractor obtained summary judgment against the general contractor based on the general contractor's default in opposing plaintiff's summary judgment motion.

The surety in that case, Fireman's Fund Insurance Companies ("Fireman's Fund"), opposed plaintiff's summary judgment motion against the general contractor. Plaintiff then moved for summary judgment against Fireman's Fund and argued that the judgment against the general contractor should have a collateral estoppel effect such that plaintiff should not have to relitigate the issue over whether it fully performed under the contract.

The Appellate Division, Second Department, noted the general rule that " a judgment entered against a principal upon default is only prima facie evidence against the surety ... and the latter remains at liberty to contest its own liability by establishing affirmatively that the principal was not liable'" (S.D.I. Corp., 208 AD2d at 708.)

The Court held that there could be no collateral estoppel effect afforded the judgment on default because there was "no basis for determining from the ... record exactly what specific issues were litigated or decided in that prior motion ...." (S.D.I. Corp., 208 AD2d at 709).