| Smith v Delta Intl. Mach. Corp. |
| 2010 NY Slip Op 00503 [69 AD3d 840] |
| January 19, 2010 |
| Appellate Division, Second Department |
| Anthony Smith et al., Respondents, v Delta InternationalMachinery Corp., Defendant, and JKR Associates, LLC, et al., Appellants. (And a Third-PartyAction.) |
—[*1] Ras Associates, PLLC, White Plains, N.Y. (Luis F. Ras of counsel), forrespondents.
In an action, inter alia, to recover damages for personal injuries, etc., the defendants JKRAssociates, LLC, JKR Property Management, Ed Kurtz, and Vivian Bova appeal, as limited bytheir brief, from so much of an order of the Supreme Court, Kings County (Hinds-Radix, J.),entered September 29, 2008, as denied those branches of their motion which were for summaryjudgment dismissing the complaint insofar as asserted against the defendants JKR Associates,LLC, JKR Property Management, and Ed Kurtz.
Ordered that the order is modified, on the law, by deleting the provisions thereof denyingthose branches of the appellants' motion which were for summary judgment dismissing thecomplaint insofar as asserted against the defendants JKR Property Management and Ed Kurtz,and substituting therefor a provision granting those branches of the motion; as so modified, theorder is affirmed insofar as appealed from, without costs or disbursements.
The plaintiff Anthony Smith (hereinafter the injured plaintiff) allegedly was injured whileusing a table saw in the course of his employment at a building owned by his employer,Glenwood KSR Associates, LLC (hereinafter Glenwood), and managed by the defendant JKRAssociates, LLC (hereinafter JKR Associates). The injured plaintiff and his wife, suingderivatively, commenced this action to recover damages for personal injuries against, amongothers, JKR Associates, JKR Property Management, Ed Kurtz, who was the principal andmanaging member of JKR Associates and Glenwood, and Vivian Bova (hereinafter together thedefendants). Thereafter, the defendants moved, inter alia, for summary judgment dismissing thecomplaint insofar as asserted against them, arguing that (1) the injured plaintiff was a specialemployee of JKR Associates and, thus, was barred from asserting claims against that entity bythe exclusivity provisions of the Workers' Compensation Law; (2) the injured plaintiff was notentitled to recover damages against Kurtz personally because Kurtz had committed nowrongdoing which would justify piercing the corporate veil of JKR Associates; and (3) thedefendant JKR Property Management was entitled to dismissal of the complaint insofar asasserted against it because no such [*2]company existed. TheSupreme Court denied those branches of the defendants' motion which were for summaryjudgment dismissing the complaint insofar as asserted against the defendants JKR Associates,JKR Property Management, and Kurtz. We modify.
A worker "may be in the general employment of one master and the special employment ofanother" (Murray v Union Ry. Co. of N.Y. City, 229 NY 110, 112-113 [1920]). Such arelationship is formed where a worker is "transferred for a limited time of whatever duration tothe service of another" (Thompson v Grumman Aerospace Corp., 78 NY2d 553, 557[1991]). Although "[g]eneral employment is presumed to continue," that presumption may beovercome by a "clear demonstration of surrender of control by the general employer andassumption of control by the special employer" (Thompson v Grumman Aerospace Corp.,78 NY2d at 557). The central question is whether there is a "working relationship with theinjured plaintiff sufficient in kind and degree so that the third party, or the third party's employer,may be deemed plaintiff's employer" (Fung v Japan Airlines Co., Ltd., 9 NY3d 351, 359 [2007]).
In the case at bar, JKR Associates did not make a prima facie showing that it was entitled tojudgment as a matter of law. The existence of a triable issue of fact as to who controlled theinjured plaintiff's work is apparent from certain deposition testimony submitted in support of thedefendants' motion. Although the injured plaintiff testified that a JKR Associates employee,Clive Cole, was his "manager," and was the "manager of the building" where he was employed,Cole denied supervising the injured plaintiff. Moreover, Kurtz, the managing member of JKRAssociates, testified that it "wasn't [Cole's] place" to direct the injured plaintiff's work. Likewise,to the extent that Kurtz controlled the injured plaintiff's work, it is unclear whether he did so inhis role as the managing member of Glenwood or of JKR Associates. Accordingly, the SupremeCourt properly denied that branch of the defendants' motion which was for summary judgmentdismissing the complaint insofar as asserted against JKR Associates.
The Supreme Court erred, however, in denying that branch of the defendants' motion whichwas for summary judgment dismissing the complaint insofar as asserted against Kurtz. Membersof a limited liability company may "be held personally liable if they participate in thecommission of a tort in furtherance of company business" (Rothstein v Equity Ventures,299 AD2d 472, 474 [2002]). However, such a remedy will be permitted only when it is"necessary 'to prevent fraud or to achieve equity' " (Walkovszky v Carlton, 18 NY2d414, 417 [1966], quoting International Aircraft Trading Co. v Manufacturers Trust Co.,297 NY 285, 292 [1948]). Furthermore, a party seeking to pierce the corporate veil "mustestablish that the owners, through their domination, abused the privilege of doing business in thecorporate form to perpetrate a wrong or injustice against that party such that a court in equitywill intervene" (Matter of Morris v New York State Dept. of Taxation & Fin., 82 NY2d135, 142 [1993]).
In opposition to the prima facie showing that Kurtz was not liable for the alleged actions ofJKR Associates, the plaintiffs failed to raise a triable issue of fact. Although the plaintiffsshowed that Kurtz, as the managing member, "dominated" JKR Associates, they pointed to noevidence showing that Kurtz "fail[ed] to adhere to corporate formalities, inadequate[ly]capitaliz[ed]" JKR Associates, "commingl[ed its] assets" with those of his other companies, or"use[d] . . . corporate funds for personal use" (East Hampton Union Free School Dist. v Sandpebble Bldrs., Inc., 66AD3d 122, 127-128 [2009] [internal quotation marks omitted]), much less that any suchwrongdoing was a cause of their alleged damages.
Additionally, the defendants proffered evidence that no entity known as "JKR PropertyManagement" existed, and that such name was never used in connection with the business ofJKR Associates. In opposition, the plaintiffs failed to raise any triable issue of fact in this regard.Accordingly, that branch of the defendants' motion which was for summary judgment dismissingthe complaint insofar as asserted against JKR Property Management should also have beengranted. Covello, J.P., Santucci, Chambers and Hall, JJ., concur.