This matter concerns a dispute between the County of Westchester (the “County”) and Standard Amusements, LLC (“Standard”) over the parties’ responsibilities under the Second Amended and Restated Playland Management Agreement (the “PMA”). Presently before this Arbitration Panel (Honorable Jonathan Lippman (Chair), Honorable Shira A. Scheindlin, and Honorable Anthony J. Carpinello) are the parties’ cross-motions for partial summary judgment regarding whether the PMA affords the County the right to cure its failure to have substantially completed capital projects equal to 70% of the projected capital project costs by April 30, 2024. For the reasons set forth below, the Panel finds that the PMA requires Standard to provide notice and the right to cure to the County before declaring a default (or breach of contract). Accordingly, the Panel grants the County’s motion and denies Standard’s motion.
BACKGROUND
The partnership history between the County and Standard is extensive. The Panel assumes familiarity with the underlying facts and recites only those necessary to explain its decision on the instant partial cross-motions for summary judgment.
On August 10, 2015, the County selected Standard as its partner to manage Playland Park, a historic park located in Rye, New York. (Standard Answer to Arbitration Demand (“Answer”) ¶¶ 1, 16). On May 3, 2016, the parties entered into a Restated and Amended Playland Management Agreement, which had a 30-year term. (Id. ¶ 22.) On July 21, 2021, the parties executed the operative PMA. (Id. ¶ 47.)
Relevant here, Section 6-a(i) of the PMA permits Standard to terminate the agreement, pursuant to conditions, and to seek certain liquidated damages if the County failed to achieve a 70% “substantial completion” (the “70% Threshold”) of its capital projects by April 30, 2024. (PMA § 6-a(i).) After months of dispute over the County’s progress on its capital projects, on January 21, 2025, Standard delivered a notice of termination pursuant to Section 6-a(i) to the County. (Answer ¶ 59.) The County does not dispute that it failed to meet the 70% Threshold by the required date.[1] Instead, both parties presently move for partial summary judgment on the narrow issue of whether Section 6-a(i) of the PMA affords the County the right to cure its failure to meet the 70% Threshold. The parties agree that the PMA is unambiguous and that it should be interpreted based on the four corners of the agreement, but they offer differing interpretations of the relevant provisions.
The County contends that the 70% Threshold is subject to the plain language of Section 21(B)(i)’s notice-and-cure language. Section 21 defines what constitutes an “Event of Default,” and Section 21(B)(i) states that an Event of Default occurs where the County “fail[s] to perform or observe any material obligation of the County under any provision of this Agreement, and such failure shall continue and shall not be remedied within thirty (30) days after notice from the Manager specifying the nature of the default.” (PMA § 21(B)(i).) The County argues that its failure to meet the 70% Threshold is a material obligation. Therefore, its failure to meet that obligation becomes an Event of Default only after notice and opportunity to cure. (See County Motion for Partial Summary Judgment (“County Motion”) at 5.)
The County further argues that the plain language of Section 6-a(i), read with relevant provisions, underscores that the 70% Threshold is subject to Section 21(B)(i)’s notice-and-cure provision. The County argues as follows: Section 6-a(i) requires the County to have substantially completed capital projects equal to 70% of the projected capital project costs by April 30, 2024. Should the County fail to meet the 70% Threshold, Section 6-a(i) permits Standard to terminate the agreement “pursuant to Section 23(B).” (Id. § 6-a(i).) Section 23(B), the County argues, directs termination to occur “pursuant to Section 22,” which provides that termination by Standard “can only occur after an Event of Default remains uncured following the applicable notice-and-cure period.” (County Motion at 8.) The County further emphasizes the language in Section 23(B) itself reiterates the right to cure, arguing that Section 23(B) provides that the “PMA will terminate ‘unless the Event of Default (if applicable) giving rise to such termination notice has been theretofore cured.’” (Id. (emphasis in motion).)
Finally, the County argues that reading the PMA as a whole demonstrates that the general purpose of the agreement necessitates that the 70% Threshold is curable. (See id. at 10.)
Standard, in turn, argues that Section 6-a(i) establishes that the County has no right to cure its failure to meet the 70% Threshold deadline because “Section 6-a(i) plainly states that ‘if the County has not met (i) the 70% Threshold before April 30, 2024…[Standard] may terminate this Agreement pursuant to Section 23(B),’” and that nothing else in Section 6-a(i) itself expressly grants the County a right to cure. (Standard Motion for Partial Summary Judgment (“Standard Motion”) at 6 (citing PMA § 6-a(i)).)
Standard further argues that, based on a reading of Section 23B(i)(a) regarding liquidated damages, the PMA distinguishes between a failure to meet the 70% Threshold and an Event of Default—meaning that failure to meet the 70% Threshold is not an Event of Default, and therefore would not warrant notice and an opportunity to cure. (See id. at 7.)
Finally, Standard argues that, as a matter of law, the County’s failure to meet the 70% Threshold cannot be cured because a missed deadline is a historical fact.
DISCUSSION
The Panel agrees with the County and finds that the PMA requires notice and a right to cure the failure to meet the 70% Threshold.
A plain reading of the PMA demonstrates that the failure to meet the 70% Threshold is subject to the PMA’s notice-and-cure provisions. The logic proceeds as follows: under Section 6-a(i), if the County fails to meet “the 70% Threshold before April 30, 2024” then Standard “may terminate this Agreement pursuant to Section 23(B).” (PMA § 6-a(i).) Section 6-a(i) references only Section 23(B) pursuant to which Standard may elect to terminate the agreement, and no other section. (See id.) Section 23(B), in turn, states that if Standard “elects to terminate this Agreement pursuant to Section 22,” then Standard shall give the County “a thirty (30) day written notice of its election to so terminate,” and that “[a]fter the giving of such notice and on or before such termination date, unless the Event of Default (if applicable) giving rise to such termination notice has been theretofore cured, the Manager shall vacate Playland Park in accordance with the provisions of this Agreement.” (Id. § 23(B).)
Section 22, in relevant part, states that “[a]fter a material Event of Default on the part of the County beyond any applicable notice and cure period that remains uncured, [Standard] shall have the right to elect to terminate this Agreement by notice to the Commissioner as provided in Section 23 below.” (Id. § 22(B) (emphasis added).) Section 21 specifies that an “Event of Default” on behalf of the County occurs if “the County shall fail to perform or observe any material obligation of the County under any provision of this Agreement, and such failure shall continue and shall not be remedied within thirty (30) days after notice from [Standard] specifying the nature of the default.” (Id. § 21(B)(i) (emphasis added).) The Panel agrees with the County that the 70% Threshold is a material obligation of the County under the PMA.
In sum, (a) Section 6-a(i) allows for termination pursuant to Section 23(B); (b) Section 23(B) refers to termination under Section 22, and only Section 22; (c) Section 22 discusses termination after “a material Event of Default”; and (d) Section 21 defines when a failure to meet any material obligation under the PMA constitutes an “Event of Default” subject to notice and right to cure. Read together, the plain language and logic of the provisions make clear that the notice and cure provisions in Sections 21(B)(i) apply to Standard’s option to terminate for failure to meet the 70% Threshold.
The Panel finds Standard’s arguments to the contrary unavailing. First, the Panel disagrees with Standard’s argument that, because the plain language of Section 6-a(i) does not itself include notice-and-cure provisions, the County lacks such a right. Failure to meet the 70% Threshold is a material obligation, and Section 21(B)(i) applies to “any material obligation of the County under any provision of this Agreement”—and nothing in Section 6-a(i) expressly precludes Section 21(B)’s broad application to “any” material obligation to the obligation to meet the 70% Threshold. (Id. § 21(B)(i) (emphasis added).)
Indeed, language elsewhere in the PMA—and absent in Section 6-a(i)—expressly provides for the right to immediately terminate the agreement, without an opportunity for cure, demonstrating that the parties knew how to exempt certain obligations from Section 21’s cure provisions but chose not to include such language in Section 6-a(i). (See, e.g., PMA § 21(A)(ii) (noting that if Standard fails “to procure and maintain Commercial General Liability insurance for the operation of Playland Park after the Management Commencement Date,…then this Agreement shall terminate immediately, there shall be no opportunity to cure and the provisions of Section 22 below shall not apply” (emphasis added)); § 3(G)(i) (noting that “the County shall have the right to terminate this Agreement immediately pursuant to Section 23(A)”).
Further, Standard’s argument that failure to meet the 70% Threshold under Section 6-a(i) is distinct from an Event of Default, and thus not subject to Section 21(B)(i)’s notice-and-cure provisions, is unavailing for two reasons. Standard first argues that Section 23B(i)(a) mandates that termination under Section 6-a(i) is distinct from termination for an Event of Default under Section 22(B) because “Section 6-a(i)” and “Section 22(B)” are listed separately under Section 23B(i)(a), and treating them alike would render that paragraph superfluous. Subsection 23B(i) is, however, plainly titled “Termination Due to Event of Default on the Part of the County.” (Id. § 23B(i)(a) (emphasis added).) To find that termination under Section 6-a(i), listed under Section 23B(i)(a), is distinct from an Event of Default as defined in the PMA, would be illogical. Indeed, Section 6-a(i) itself states that if the failure to meet the 70% Threshold is for any reason except by result of a Force Majeure or unavoidable circumstance beyond the County’s control, Standard may “terminate[] this Agreement pursuant to Section 23(B), [and Standard] shall be entitled to the applicable Liquidated Damages Payment payable upon a ‘Termination Due to Event of Default on the Part of the County.’” (Id. § 6-a(i) (emphasis added).)[2]
Further, in the adjacent Section 23B(iii)(a), titled “Termination Not Due to Event of Default,” Section 6-a(i) is again listed, but specifically only “regarding the County’s failure to meet a Threshold as a result of a Force Majeure or other unavoidable circumstance beyond the County’s control”—indicating that were Standard to seek termination for failure to meet the 70% Threshold in the absence of a Force Majeure or circumstance beyond the County’s control, such failure would affirmatively constitute an Event of Default and be subject to termination under Section 22(B) only where the notice and cure period remained uncured. (Id. § 23B(iii)(a); 22(B).) Standard points to no other provision that expressly precludes the application of Section 21(B)(i)’s notice-and-cure provision to Section 6-a(i), and the Panel finds it unlikely that the parties would agree to allow immediate termination of a 30-year agreement for failure to meet the 70% Threshold without making such an intention explicit in the PMA, especially because a right to cure is made explicit in Section 21(B)(i).[3]
Finally, Standard relies on three bankruptcy cases for the proposition that “when a party breaches its obligation to meet a contractually mandated deadline, such breach cannot be cured.” (Standard Motion at 8.) The Panel finds Standard’s argument, and the cases on which it relies, to be inapposite, and in any case, to contradict the PMA’s plain language. Indeed, two of the bankruptcy cases concern contracts that contained time-is-of-the-essence provisions; the third found a default incurable because the default was grounds for termination pursuant to a specific section of the New York Vehicle and Traffic Law. Here, neither Section 6-a(i) nor elsewhere in the PMA contains any express “time is of the essence” language to suggest that failure to meet the Threshold should be incurable, nor does Standard posit that the County’s failure is grounds for termination pursuant to a specific state statute. Given the presence of language elsewhere in the PMA, like Section 21(A), providing the right to immediately terminate the agreement without cure, it would be inappropriate to read Section 6-a(i) as providing no right to cure when such language is absent. Standard fails to demonstrate that the County’s failure to meet the 70% Threshold would frustrate the purpose of the entire thirty-year agreement.
CONCLUSION
For the reasons above, the Panel grants the County’s motion for partial summary judgment and therefore finds Standard’s notice of termination dated January 21, 2025, to be invalid and void for failing to acknowledge the County’s right to cure. Standard’s partial motion for summary judgment is accordingly denied.
[1] In a November 18, 2024 letter to Standard, the County stated that its “position has been that it achieved the 70% threshold on May 15, 2024, based upon completion of sub-components of a capital project[.]” (County Response to Standard’s Motion for Partial Summary Judgment (“County Response”), Exhibit 7.) The County reiterated this position in its response to Standard’s partial summary judgment motion. (Id. at 11 (citing Ex. 7)).) The parties, however, dispute the margin by which the County missed the 70% Threshold. Standard claims that the County had completed only 31% of the required capital projects by April 30, 2024; the County, on the other hand, argues that it had completed at least 65% by April 30, 2024. (Id.) The County further argues that, in an August 26, 2024 letter, Standard failed to challenge the County’s then-assertion “that the Capital Plan was otherwise 67% complete.” (Id.)
[2] For this reason, Standard cannot hang its hat on the words “if applicable” in Section 23(B) to argue that “Section 23(B) also applies to a situation (i.e., Section 6-a(i) termination) that does not involve an Event of Default.” (Standard Response to County Motion at 3.)
[3] Accordingly, Standard’s position raised in its Answer that Standard has an “unqualified right to terminate the PMA because Section 6-a(i) states that “[n]otwithstanding anything to the contrary, if the County has not met” the 70% Threshold, then Standard “may terminate this Agreement pursuant to Section 23(B),” is of no moment. (Answer ¶ 61; PMA § 6-a(i).) First, as discussed, Standard has not pointed to “anything to the contrary” that expressly precludes application of Section 22(B)’s notice-and-cure provisions to the failure to meet the 70% Threshold. Second, the language of “[n]otwithstanding anything to the contrary” appears to reference earlier parts of Section 6-a(i) that discuss mechanisms for extending project deadlines unrelated to the 70% Threshold obligation. (PMA § 6-a(i).)
Hon. Jonathan Lippman, Chair
On behalf of the Panel
Date: June 26, 2025