The NYCHA project on which Diontech was a subcontractor to PMS had to be temporarily suspended because funding had been delayed. When the funding became available Diontech demanded payment for delay damages. When payment was not forthcoming Diontech filed suit.

The trial court granted the motion by NYCHA and PMS to dismiss Diontech’s lawsuit, which was affirmed on appeal on several grounds:

1 – Diontech had signed two releases which were held to be valid and thus a bar to the delay claim that was the subject of the releases. The fact that Diontech received a change order for extra work after the releases were signed did not somehow revive the released delay claim.

2 – Dismissal was also warranted by Diontech’s failure to comply with the requirements in the contract for timely notice of its claim.

3 – The contract contained a no-damage-for-delay provision, and the lack of funding did not constitute one of the recognized grounds to set aside that provision.