| Nassau County v Richard Dattner Architect, P.C. |
| 2008 NY Slip Op 09569 [57 AD3d 494] |
| December 2, 2008 |
| Appellate Division, Second Department |
| Nassau County, Respondent, v Richard Dattner Architect, P.C.,et al., Defendants, and KeySpan Corporation, Appellant. (And a Third-PartyAction.) |
—[*1] Lorna B. Goodman, County Attorney, Mineola, N.Y. (Dennis J. Saffran of counsel), forrespondent.
In an action, inter alia, to recover damages for breach of contract and negligence, the defendantKeySpan Corporation appeals, as limited by its brief, from so much of an order of the Supreme Court,Nassau County (Austin, J.), entered May 25, 2007, as denied its motion for summary judgmentdismissing the complaint insofar as asserted against it.
Ordered that the order is reversed insofar as appealed from, on the law, with costs, and theappellant's motion for summary judgment dismissing the complaint insofar as asserted against it isgranted.
In 1996 the defendant Roy Kay, Inc. (hereinafter Roy Kay), signed a contract with the defendantDormitory Authority of the State of New York to perform heating, ventilation, and air conditioningwork as part of the construction of an Aquatic Center for the plaintiff Nassau County. Roy Kaycompleted the project in 1998. On January 20, 2000 nonparty KeySpan Services, Inc. (hereinafterKSI), acquired all of the stock of Roy Kay. KSI was then, and remains, a wholly-owned subsidiary ofKeySpan Energy Corporation, which is, in turn, wholly owned by the appellant KeySpan Corporation.Subsequent to KSI's acquisition of Roy Kay, Roy Kay was merged with KSI Contracting, LLC. KSIis the sole member of, and owns, KSI Contracting, LLC.[*2]
On February 27, 2004 Nassau County sued, among others,the appellant, alleging that the construction of the Aquatic Center was defective. Following its joinder ofissue, the appellant moved for summary judgment dismissing the complaint insofar as asserted against it.It argued that when the subject contract was executed, it had no relationship to Roy Kay, and whateverliabilities Roy Kay had at the time it merged with KSI Contracting, LLC, were transferred to, andremain with, the latter company. In opposition to the motion, the plaintiff argued that there werequestions of fact as to whether the appellant could be held liable to it based on a corporate-veil piercingtheory, and that since discovery relevant to that issue was necessary, the motion should be deniedunder CPLR 3212 (f). The Supreme Court denied the appellant's motion, concluding that morediscovery was necessary.
Generally, piercing the corporate veil requires a showing that (1) the corporate owners exercisedcomplete domination and control of the corporation in respect of the transaction attacked, and (2) suchdomination and control was used to commit a fraud or wrong against the plaintiff which resulted in theplaintiff's injury (see Matter of Morris v New York State Dept. of Taxation & Fin., 82 NY2d135, 141 [1993]; Seuter v Lieberman, 229 AD2d 386 [1996]; New York Assn. forRetarded Children, Montgomery County Ch. v Keator, 199 AD2d 921, 922 [1993]).Furthermore, a parent company will not be held liable for the torts of its subsidiary unless it can beshown that the parent exercises complete domination and control over the subsidiary (see Serrano v New York Times Co., Inc.,19 AD3d 577, 578 [2005]).
Here, the appellant demonstrated its prima facie entitlement to judgment as a matter of law (seegenerally Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). In opposition, the plaintifffailed to raise a triable issue of fact as to whether the appellant dominated and controlled the activitiesof the subsidiary that owns Roy Kay's successor entity and, moreover, made no showing that discoverymight reveal the existence of facts within the appellant's control which would warrant the denial of themotion (see CPLR 3212 [f]; Serrano v New York Times Co., Inc., 19 AD3d at 578).Therefore, the Supreme Court should have granted the appellant's motion for summary judgmentdismissing the complaint insofar as asserted against it.
In view of the foregoing, we do not address the parties' remaining contentions. Ritter, J.P., Florio,Miller and Carni, JJ., concur. [See 15 Misc 3d 1140(A), 2007 NY Slip Op 51065(U).]