Introduction

In this published decision, the Appellate Division, Second Department, affirms a judgment awarding plaintiffs a refund of their $27,649.89 deposit paid to a catering company for a May 17, 2020 wedding that could not proceed due to the COVID‑19 pandemic and associated gubernatorial executive orders. The court holds that:

• Frustration of purpose applies to event-catering contracts disrupted by COVID‑19 executive orders, supporting summary judgment in favor of purchasers seeking return of deposits;
• Ambiguity in the parties’ written contract permitted reliance on parol evidence—in this case, a menu—to fix the intended date and place of performance;
• A vendor’s counterclaim for anticipatory breach fails where the purchaser’s nonperformance was compelled by law rather than a repudiation; and
• Procedurally, an appeal from an interlocutory order is subsumed in the appeal from the ensuing judgment (Matter of Aho).

The case clarifies how New York courts in the Second Department will address pandemic-era event contracts: where the governmental restrictions strike at the heart of the bargain—here, an in-person wedding reception—the doctrine of frustration of purpose can discharge the parties’ obligations and require a return of deposits, while also defeating anticipatory breach theories advanced by vendors.

Summary of the Opinion

Plaintiffs contracted with Heavenly Events & Catering Corporation (“Heavenly”) to cater a wedding scheduled for May 17, 2020 in New York. Plaintiffs paid a deposit of $27,649.89. When the COVID‑19 pandemic triggered executive orders restricting gatherings, the planned event could not occur.

Plaintiffs sued, inter alia, for breach of contract to recover the deposit. Heavenly counterclaimed for anticipatory breach and asserted affirmative defenses. The Supreme Court (Kings County) granted plaintiffs summary judgment on their breach claim, dismissed Heavenly’s affirmative defenses and counterclaim under CPLR 3211, and denied Heavenly’s competing motion for summary judgment. The Appellate Division:

• Dismissed Heavenly’s appeal from the interlocutory order as subsumed by the appeal from the judgment (Matter of Aho; CPLR 5501[a][1]);
• Affirmed the judgment awarding the plaintiffs the principal sum of $27,649.89;
• Held that the contract was ambiguous and parol evidence (a menu) properly clarified the parties’ intent that performance would occur on May 17, 2020 in New York;
• Concluded that plaintiffs made a prima facie showing of frustration of purpose based on the COVID‑19 pandemic and Executive Orders (A. Cuomo) Nos. 202.10 and 202.31, and Heavenly failed to raise a triable issue of fact;
• Affirmed dismissal of Heavenly’s counterclaim for anticipatory breach, because plaintiffs did not repudiate—they could not perform due to the executive orders (Princes Point; Children of America); and
• Awarded costs to plaintiffs.

Analysis

1) Precedents Cited and Their Role

• Contract formation and ambiguity:
  • Matter of Civil Serv. Empls. Assn., Inc. v Baldwin UFSD, 84 AD3d 1232, 1233–34: Reiterates the elements of an enforceable agreement—offer, acceptance, consideration, mutual assent, and intent to be bound. The court invoked this baseline to frame the parties’ contract dispute.
  • Kamel v Ahgelian, 210 AD3d 973, 973–74: Articulates the “meeting of the minds” requirement and the focus on objective manifestations of intent in context. This supports the court’s determination to examine the contract as a whole and the surrounding circumstances.
  • 17 Lexington Ave., LLC v Alison Six Star, LLC, 229 AD3d 484, 486–87: States the parol evidence rule and the exception for ambiguity—extrinsic evidence may be considered when contract language is reasonably susceptible of more than one interpretation. The court relied on this to admit the “menu” as parol evidence clarifying date and place of performance.
• Frustration of purpose and impossibility:
  • Gulf LNG Energy, LLC v Eni S.p.A., 232 AD3d 183, 192, and Crown IT Servs., Inc. v Koval‑Olsen, 11 AD3d 263, 265; Restatement (Second) of Contracts § 265: Define frustration of purpose—the frustrated purpose must be “so completely the basis of the contract” that, as understood by both parties, without it, the transaction “would have made little sense.” These authorities support the conclusion that an in-person wedding reception is the essence of a wedding catering agreement, such that bans on gatherings vitiate the contract’s foundational purpose.
  • Matter of Rebell v Trask, 220 AD2d 594, 598: Frustration is unavailable where the event was foreseeable and could have been provided for by contract. Although foreseeability is relevant, the court found plaintiffs made a prima facie showing that the pandemic restrictions frustrated the contract’s purpose, and Heavenly failed to raise factual issues regarding foreseeability or risk allocation that would preclude summary judgment.
  • RW Holdings, LLC v Mayer, 131 AD3d 1228, 1230, quoting Pleasant Hill Developers, Inc. v Foxwood Enters., LLC, 65 AD3d 1203, 1206: Impossibility may excuse performance when governmental actions render it impossible, provided such actions were unforeseeable. While the decision centers on frustration of purpose, this impossibility principle frames the legal landscape in which COVID‑19 executive orders are analyzed.
• Anticipatory breach and CPLR 3211:
  • Princes Point LLC v Muss Dev. L.L.C., 30 NY3d 127, 133: Defines anticipatory breach as repudiation before performance is due, and specifies that mere expressions of difficulty are not repudiation. This authority undercuts Heavenly’s counterclaim, because the plaintiffs’ nonperformance flowed from legal prohibition rather than repudiation.
  • Children of Am. (Cortlandt Manor), LLC v Pike Plaza Assoc., LLC, 113 AD3d 583, 584: Reinforces that difficulty does not amount to renunciation. Applied to pandemic constraints, plaintiffs’ inability to proceed was not a renunciation but a legal impossibility/frustration.
  • Twitchell Tech. Prods., LLC v Mechoshade Sys., LLC, 227 AD3d 45, 51–52; Clevenger v Yuzek, 222 AD3d 931, 934: State the CPLR 3211(a)(7) standards—on a pleading motion, facts are accepted as true; where evidentiary matter is considered, the question becomes whether the pleader has a cause of action. These cases authorize the court’s reliance on the executive orders to determine that Heavenly lacked a viable anticipatory breach claim.
• Appellate procedure:
  • Matter of Aho, 39 NY2d 241, 248; CPLR 5501(a)(1): Direct appeals from nonfinal orders terminate upon entry of judgment, but issues are reviewable on appeal from the judgment. The Second Department applies this standard to streamline review.

2) The Court’s Legal Reasoning

1. Contract ambiguity and parol evidence:

   The court determined that the written contract was ambiguous as to a material term—the precise date and place of performance. Under New York’s parol evidence rule, ambiguity opens the door to extrinsic evidence to resolve the parties’ intent. Here, a “menu” document served as parol evidence confirming that performance was intended on May 17, 2020 in New York. This finding was pivotal: it anchored the contract’s performance to the time and location directly affected by the executive orders, setting the stage for a frustration analysis tethered to those orders.

2. Frustration of purpose:

   Applying Gulf LNG Energy and the Restatement § 265, the court held that plaintiffs made a prima facie showing that the central purpose of the catering contract—a large, in-person wedding reception—was frustrated by the pandemic and associated executive orders (EO 202.10, 202.31). The orders restricted gatherings and dining operations in ways that nullified the contemplated event. In opposition, Heavenly failed to raise a triable issue of fact, such as evidence that:

   • The parties’ purpose encompassed a legally compliant alternative use (e.g., a significantly downsized or virtual event);
   • The contract allocated pandemic risk to the purchasers (e.g., through a force majeure clause expressly making deposits nonrefundable under government shutdowns); or
   • The events and restrictions were foreseeable at the time of contracting and addressed in the agreement.

   Without such countervailing proof, summary judgment for plaintiffs was warranted. The ruling implicitly recognizes that pandemic shutdown orders can, as a matter of law on an uncontested record, destroy the foundational purpose of an in-person wedding-catering bargain.

3. Impossibility context:

   Although the court did not base its holding on impossibility, it cited RW Holdings and Pleasant Hill to frame the related doctrine: governmental actions can render performance impossible if unforeseeable. This reinforces the legitimacy of treating COVID‑19 executive orders as legally significant intervening events in contract disputes.

4. Anticipatory breach counterclaim dismissed:

   Heavenly’s counterclaim alleged that plaintiffs repudiated before performance was due. The court rejected that theory, relying on Princes Point: repudiation requires a clear, unequivocal refusal to perform, not mere difficulty. Because the executive orders foreclosed lawful performance of the contemplated event, plaintiffs did not repudiate; they were prevented from performing. Considering evidentiary material (the executive orders) under CPLR 3211(a)(7), the court concluded Heavenly lacked a cause of action for anticipatory breach as a matter of law.

5. Remedy and procedural posture:

   With frustration established and no triable issues raised, the court affirmed the judgment awarding plaintiffs a refund of their deposit as damages for Heavenly’s failure to return it. Procedurally, the court applied Matter of Aho to dismiss the direct appeal from the interlocutory order and addressed all issues on the appeal from the final judgment.

3) Impact and Practical Implications

• Event and hospitality contracts:

  The decision strengthens purchasers’ ability within the Second Department to recover deposits for event-catering agreements where pandemic-era executive orders wiped out the very purpose of the bargain. Vendors who retained deposits despite legally prohibited performance face heightened risk of summary judgment against them unless they can show clear contractual risk allocation or viable alternative performance consistent with the contract’s purpose.

• Proof of intended performance details:

  The court’s willingness to accept a “menu” as parol evidence underscores a flexible, context-sensitive approach to ambiguity. Parties should expect that courts may look to event-specific documents (e.g., menus, run-of-show sheets, proposals, emails) to fill in missing or ambiguous terms that are material to performance, such as date, time, venue, and guest count.

• Anticipatory breach defenses limited:

  Vendors’ anticipatory-breach counterclaims premised on clients’ cancellations in the face of legal prohibitions are on precarious footing. The proper legal framing is often frustration or impossibility, not repudiation. Absent clear, unequivocal renunciation unrelated to legal impossibility, anticipatory breach claims are vulnerable at the pleading stage.

• Contract drafting going forward:

  Parties should expressly allocate risk for government shutdowns, pandemics, and public-health emergencies. Key points to address:

  • Whether deposits are refundable, partially refundable, or fully earned upon booking in the face of force majeure events;
  • Rescheduling rights and deadlines;
  • Alternative performance (e.g., scaled-down guest counts, outdoor service) and pricing adjustments;
  • Insurance requirements and mitigation obligations.

  Explicit terms can overcome the default frustration analysis, subject to unconscionability limits.

• Litigation strategy:

  Plaintiffs can prevail via summary judgment when the record clearly ties the contract’s purpose to a time/place affected by executive orders and the vendor shows no contractually allocated risk or viable alternative performance. Defendants should marshal evidence of foreseeability at the time of contracting, specific risk-allocation provisions, or alternative performance consistent with the contract’s purpose to create triable issues.

• Scope and limits:

  The holding is fact-sensitive. It addresses wedding catering scheduled during the period of stringent executive restrictions. Different outcomes may arise where:

  • The event date fell outside strict lockdown periods;
  • The contract included a force majeure clause expressly addressing pandemics and deposit treatment;
  • Performance could proceed in a manner still aligned with the parties’ central objective (e.g., a permitted, materially similar gathering).

Complex Concepts Simplified

• Frustration of purpose:

  This doctrine excuses a party from performing when an unforeseen event destroys the principal reason both parties entered the contract. Performance might still be possible in a literal sense, but it would no longer make sense because the core purpose is gone. Example: a catering contract for a large wedding reception is frustrated when government orders ban such gatherings on the event date.

• Impossibility:

  Separate from frustration, impossibility excuses performance when it becomes objectively impossible due to events beyond the parties’ control, such as a new law or government order making the promised performance illegal. Foreseeability matters: if the event was foreseeable and the contract could have addressed it, the doctrine is less likely to apply.

• Anticipatory breach (repudiation):

  A claim that the other party made a clear, unequivocal statement or act indicating they will not perform when performance is due. Mere expressions of difficulty or delay do not qualify. If performance is prevented by law, a party’s inability to perform is not a repudiation.

• Parol evidence and ambiguity:

  Courts interpret contracts based on the written terms. If the writing is clear, extrinsic evidence is generally not allowed to change it. If the writing is ambiguous—reasonably susceptible to more than one interpretation—extrinsic or “parol” evidence (such as related documents, communications, or course of dealing) may be used to determine what the parties actually intended.

• Summary judgment and prima facie showing:

  To win on summary judgment, a moving party must first make a prima facie (on its face) showing that there is no genuine dispute over material facts and that the law entitles them to judgment. If they do, the burden shifts to the opponent to raise a triable issue of fact. Failure to do so results in judgment without a trial.

• CPLR 3211(a)(7) motions:

  A motion to dismiss for failure to state a cause of action. The court accepts the pleaded facts as true and asks whether those facts fit any valid legal theory. If the court considers evidentiary materials and does not convert the motion to summary judgment, the inquiry becomes whether the pleader truly has a cause of action at all.

• Matter of Aho and CPLR 5501(a)(1):

  After a final judgment, an appeal from a prior nonfinal order usually becomes academic; the issues from that order are reviewed within the appeal from the final judgment. This is a procedural efficiency rule.

Conclusion

Kay v. Heavenly Events & Catering Corp. crystallizes three practical and doctrinal points for New York’s Second Department:

1. Pandemic-era executive orders can, as a matter of law on an undisputed record, frustrate the purpose of event-catering contracts aimed at large, in-person gatherings, thereby entitling purchasers to return of deposits when vendors cannot deliver the contemplated event.
2. When a contract is ambiguous, courts will admit parol evidence—even event-specific documents like menus—to fix the date/place of performance and illuminate the parties’ shared purpose.
3. Anticipatory breach counterclaims fail where a party’s nonperformance flows from legal prohibition rather than repudiation, particularly on a CPLR 3211 record supplemented by the controlling executive orders.

The decision’s significance lies in its clear, structured deployment of frustration-of-purpose principles to the wedding-catering context and its practical guidance on evidence and pleading. It will inform how courts, counsel, and contracting parties handle deposit disputes arising from government-imposed shutdowns and will influence contract drafting to expressly allocate pandemic and force majeure risks in the hospitality and events sector.