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 <**25>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).
We held the make sure “embod[ied] a contract not the same as new bargain to provide roofing material,” brand new infraction of which brought about the newest law out of limits anew (id. in the 610). This is very because accused for the Bulova View “didn’t merely guarantee the standing otherwise abilities of one’s products, but agreed to perform a service” (id. from the 612). You to definitely services was the latest independent and you can type of promise to fix good faulty roof-a significant part of the newest parties’ deal and “an alternative, independent and additional added bonus to purchase” the fresh defendant’s equipment (id. at 611). Correctly, the newest “preparations considering properties . . . was basically subject to a half a dozen-season law . . . running ages occasioned whenever a breach of your duty to help you resolve new fused roof occurred” (id.).
DBSP’s eliminate or repurchase responsibility was brand new Trust’s remedy for an excellent breach of them representations and you can guarantees, maybe not a hope of your own loans’ coming results
The fresh remedial clause from inside the Bulova View explicitly guaranteed upcoming abilities out-of the rooftop and you can undertook a promise to repair the fresh roof in the event the it did not satisfy the seller’s make sure. They [*7] illustrated and you may justified particular factual statements about the brand new loans’ functions as of , in the event the MLPA and you may PSA was indeed done, and you may explicitly stated that men and women representations and you can guarantees don’t survive brand new closure date. Unlike the new independent ensure when you look at the Bulova Watch, DBSP’s reduce or repurchase duty couldn’t relatively be looked at because the a definite guarantee regarding upcoming overall performance. It actually loans East Point was determined by, and even derivative of, DBSP’s representations and warranties, hence did not endure the closure and was in fact breached, if, thereon go out. [FN3]
Actually, little from the contract given the cure or repurchase duty manage continue for the life of your own loans
And it makes sense that DBSP, as sponsor and seller, would not guarantee future performance of the mortgage loans, which <**25>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 <**25>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
