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 your be sure “embod[ied] a binding agreement unlike the newest package to offer roof content,” the latest infraction from which caused the fresh law out of constraints anew (id. within 610). It was very as accused inside the Bulova Observe “don’t just ensure the standing otherwise results of one’s items, however, accessible to do a support” (id. at the 612). One to service is actually the separate and you will distinctive line of hope to fix a great bad roof-a life threatening part of new parties’ offer and you can “another, separate and additional added bonus to buy” the new defendant’s tool (id. from the 611). Appropriately, the fresh new “arrangements thinking about attributes . . . had been susceptible to a half dozen-year statute . . . running many years occasioned each time a violation of your own obligation so you’re able to repair brand new bonded roof taken place” (id.).
DBSP’s clean out otherwise repurchase responsibility is new Trust’s fix for a beneficial violation of these representations and guarantees, perhaps not a guarantee of your loans’ future efficiency
New corrective term inside the Bulova Check out explicitly secured upcoming efficiency of the roof and undertook a vow to fix the newest rooftop when the they failed to match the seller’s be sure. It [*7] illustrated and rationalized particular facts about the fresh new loans’ functions as of , if MLPA and you can PSA have been done, and explicitly stated that those representations and you will guarantees don’t endure the fresh closing go out. Unlike new separate make certain within the Bulova See, DBSP’s cure otherwise repurchase duty couldn’t reasonably be regarded as since a definite pledge from coming performance. It had been dependent on, and even derivative out-of, DBSP’s representations and you can guarantees, hence did not survive the brand new closure and you may had been breached, if, on that big date. [FN3]
In reality, little in the bargain specified the eliminate or repurchase responsibility would last for the life of the fund
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 no credit check loans in Coosada AL 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