| Hughey v RHM-88, LLC |
| 2010 NY Slip Op 07490 [77 AD3d 520] |
| October 21, 2010 |
| Appellate Division, First Department |
| Keith Hughey et al., Plaintiffs, v RHM-88, LLC, et al.,Defendants, Pritchard Industries, Inc., Respondent-Appellant, and One United Nations PlazaCondominium, Appellant-Respondent. (And a Third-Party Action.) One United Nations PlazaCondominium, Second Third-Party Plaintiff-Appellant-Respondent, v Cushman & Wakefield, Inc.,Second Third-Party Defendant-Respondent-Appellant. (And OtherActions.) |
—[*1] Russo, Keane & Toner, LLP, New York (Thomas F. Keane of counsel), for Pritchard Industries,Inc., respondent-appellant. Mischel & Horn, P.C., New York (Naomi M. Taub of counsel), for Cushman & Wakefield, Inc.,for respondent-appellant.
Order, Supreme Court, New York County (Doris Ling-Cohan, J.), entered April 15, 2009, which,to the extent appealed from, denied the motion of defendant One United Nations Plaza Condominium(UNPC) to dismiss the complaint for plaintiffs' failure to serve a notice of claim; granted defendantPritchard's motion for summary judgment dismissing plaintiffs' claims against [*2]it; qualified the conditional order of contractual indemnification in favor ofUNPC as against second third-party defendant Cushman & Wakefield (C&W); conditionally grantedcontractual indemnification in favor of UNPC and C&W against Pritchard; and conditionally awardedcontractual indemnification in favor of Pritchard and UNPC against C&W, unanimously modified, onthe law, the conditional award in Pritchard's favor against C&W vacated, and otherwise affirmed,without costs.
The court correctly held that plaintiffs were not required to file a notice of claim prior to suingUNPC. Unlike defendant United Nations Development Corporation (UNDC), UNPC is not a publicbenefit corporation entitled to notice under General Municipal Law § 50-i (1). UNPC offers nosupport for its novel argument that it is the alter ego of the City.
Nor is there any merit to UNPC's alternative arguments: (1) that plaintiffs' complaint against itshould have been dismissed because it delegated full responsibility for the two forces that allegedlycaused this injury—maintenance and repair of the canopy and gutter, and removal of snow andice from the sidewalks—to C&W and Pritchard, respectively, thus precluding a charge ofconstructive notice of any allegedly dangerous condition created as a result of these other entities'failures to fulfill the requirements of their contracts; (2) that in any event, it is the UNPC Board, notUNPC, that has control over and responsibility for the common areas. UNPC and its Board are oneand the same for purposes of this lawsuit. Moreover, an issue of fact exists as to whether UNPC hadconstructive notice of the recurring ice formation as a result of the leaky gutter, inasmuch as theMillennium Hotel and UNDC, which are closely intertwined and employ high-level personnel incommon with UNPC, were both named as defendants in another case in which the plaintiff thereclaimed to have been injured in the same manner and in the same location as plaintiffs herein. In anyevent, UNPC can be held liable to plaintiffs as C&W's principal for any negligence committed byC&W, even if UNPC were not itself actively and directly negligent. Moreover UNPC, as a landowner,may not delegate its duty to keep its premises in a safe condition with regard to third parties. Rather, itsrecourse is to secure an indemnification agreement from the party to whom it delegates specificresponsibilities, and "allocate the risk of liability to third parties by the procurement of liability insurancefor their mutual benefit" (Morel v City of New York, 192 AD2d 428, 429 [1993]).
The court also properly dismissed plaintiffs' claims against Pritchard, correctly holding thatPritchard owed no duty to the injured plaintiff because the cleaning services agreement was betweenPritchard and UNPC, and the injured person was neither a party to, nor an intended third-partybeneficiary of, that contract (see Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76NY2d 220, 226 [1990]). Nor do any of the exceptions set forth in Espinal v Melville SnowContrs. (98 NY2d 136 [2002]) apply to justify imposing tort liability against Pritchard in favor ofplaintiffs.
With respect to the cross claims for contractual indemnification among UNPC, C&W andPritchard, there is evidence to indicate all three parties may have had at least constructive notice of thedangerous condition that allegedly caused the accident herein. The injured plaintiff testified that thewater that formed the ice came from a leaky gutter located on the bottom part of the glass canopy.UNPC had overall responsibility for this dangerous condition as the landowner, C&W hadresponsibility pursuant to the property management agreement to repair and maintain the leaky gutter,and Pritchard had responsibility pursuant to the cleaning services agreement to remove ice and snowfrom the sidewalks. The injured plaintiff added that he had observed water leaking from the gutter onthe day of his accident and on numerous prior [*3]occasions, that iceaccumulated on the sidewalk as a result of water leaking from the gutter approximately a dozen times ayear, and that he had heard about other people falling on the ice in the past. There is evidence thatC&W knew about the recurring icy sidewalk condition based on this testimony that the injured plaintiffhad told his supervisor at C&W about the condition but was unaware of any efforts made to stop theleak. If Pritchard was aware of ice forming on the sidewalk on a regular basis, it would be obligated totell someone at C&W or UNPC about it so those entities could take the necessary precautions duringthe days/hours Pritchard's porters were not on site to remove it. In any event, all three parties couldhave had constructive notice by virtue of the prior lawsuit stemming from a virtually identical accident inwhich UNPC, C&W and, eventually, Pritchard, were named.
The extent to which the parties will be entitled to indemnification, however, will depend on theextent to which each party's negligence is determined to have contributed to the accident. Hence, thecourt correctly granted a conditional order of contractual indemnification in favor of UNPC againstC&W. The agreement contains a sufficiently clear and unambiguous provision requiring C&W toindemnify UNPC for any liability arising out of C&W's negligence not otherwise covered by insurance,and the provision only purports to indemnify UNPC to the extent it was not itself negligent (seeGeneral Obligations Law § 5-322.1 [1]; Brooks v Judlau Contr., Inc., 11 NY3d 204, 210 [2008]; Rodrigues v N & S Bldg. Contrs., Inc., 5NY3d 427, 433 [2005]; Itri Brick & Concrete Corp. v Aetna Cas. & Sur. Co., 89NY2d 786, 795 [1997]; Collins v SwitzerConstr. Group, Inc., 69 AD3d 407, 408 [2010]). On the other hand, the propertymanagement agreement also expressly requires UNPC to obtain a comprehensive general liabilityinsurance policy and to name C&W as an additional insured under that policy, which UNPC concedesit failed to do. The court thus properly qualified that conditional order of indemnification to account forany out-of-pocket costs C&W might be entitled to recover from UNPC for the latter's failure toprocure insurance for C&W (see Inchaustegui v 666 5th Ave. Ltd. Partnership, 96 NY2d 111,114 [2001]).
The court also correctly granted UNPC and C&W conditional orders of contractualindemnification against Pritchard. The cleaning services agreement expressly requires Pritchard toindemnify UNPC and its agent, C&W, for any liability arising out of Pritchard's negligence, andcontains the requisite saving language, "to the fullest extent permitted by law," to ensure that UNPC andC&W will only be indemnified to the extent they are not responsible for the injured plaintiff's accident.
The court erred, however, in granting conditional orders of indemnification in favor of Pritchardagainst C&W. Pritchard did not assert any cross claims for indemnification, based on common law orcontract. Even if Pritchard had asserted a cross claim against C&W for common-law indemnification, itwould be barred by Workers' Compensation Law § 11 because the injured party has notsustained a "grave injury." Furthermore, no contract exists between C&W and Pritchard that obligatesC&W to indemnify Pritchard, thus precluding any claim by Pritchard for contractual indemnificationagainst C&W.
We have considered the parties' remaining contentions and find them unavailing.Concur—Sweeny, J.P., Freedman, Richter, Manzanet-Daniels and RomÁn, JJ. [PriorCase History: 2009 NY Slip Op 30829(U).]