Opinion
April 13, 1987
Appeal from the Supreme Court, Rockland County (Ruskin, J.).
Ordered that the order is affirmed insofar as appealed from, with one bill of costs payable to the defendant third-party plaintiff and third-party defendants appearing separately and filing separate briefs.
The defendant third-party plaintiff surety's obligation in this case to complete work left unfinished by its principal, the third-party defendant Field Electric Company, Inc. (hereinafter Field), was made conditional pursuant to the performance bond issued, upon that third-party defendant's default on the contract. Thus, the defendant third-party plaintiff could only be held liable for failure to comply with the plaintiff's demand to complete the work on Field's contract with the plaintiff if Field had defaulted on its contract (see, Walcutt v Clevite Corp., 13 N.Y.2d 48, 56; Eckstein v Massachusetts Bonding Ins. Co., 281 N.Y. 435, 438, rearg denied 282 N.Y. 590; Lamparter Acoustical Prods. v Maryland Cas. Co., 64 A.D.2d 693; Miller v Fitzpatrick, 227 App. Div. 745, 746).
At the arbitration proceeding which preceded this action, the plaintiff made a counterclaim for all damages sustained as a result of Field's failure to complete the work on the contract. This counterclaim was denied in its entirety by the arbitrators. This was, in effect, a determination that the plaintiff had no cause of action against the third-party defendants for defaulting on the contract. A determination having been made that the plaintiff had no cause of action against the defendant third-party plaintiff's principal for default on the contract, the plaintiff was collaterally estopped from subsequently suing the defendant third-party plaintiff for failure to honor its obligation as surety to complete the contractual work upon demand by the plaintiff (see, New Paltz Cent. School Dist. v Reliance Ins. Co., 97 A.D.2d 566, 567). The fact that the prior determination was an unconfirmed arbitration award and not a judicial determination does not lessen its collateral estoppel effect (see, Ecker v Lerner, 123 A.D.2d 661; Hilowitz v Hilowitz, 85 A.D.2d 621).
Since the plaintiff's cause of action is barred in its entirety, it obviously follows that its claim for punitive damages is without merit. Mollen, P.J., Mangano, Eiber and Sullivan, JJ., concur.