The opinion of the court was delivered by: Sweet, District Judge.
Claimant Oscar Porcelli ("Porcelli") has moved for summary judgment
dismissing the cross-claim and counterclaims against him in this action.
For the following reasons, the motion is denied.
The parties and facts involved in this action are discussed in prior
opinions of this court, familiarity with which is assumed. See In re
Complaint of Poling Transp. Corp., 776 F. Supp. 779 (S.D.N Y 1991); In re
Complaint of Poling Transp. Corp., 764 F. Supp. 857 (S.D.N.Y.), modified
in part on reh'g, 764 F. Supp. 857 (S.D.N.Y. 1991).
Porcelli is the sole director, officer and shareholder of Ditmas Oil
Associates, Inc. ("Ditmas"), Chambers Transport, Inc. ("Chambers"), Lusa
Realty, Inc. ("Lusa"), Gaseteria Inc. ("Gaseteria") and Racal
Construction Company ("Racal") (collectively, the "Porcelli
Corporations"). In this action, Porcelli is the subject of (1) a
counterclaim by Poling Transportation Corporation and Motor Vessel Poling
Bros. No. 7, Inc. ("Poling") for damages to the Motor Vessel Poling Bros
No. 7 (the "Vessel") and for contribution and/or indemnification for any
liability resulting from this action; and (2) a cross-claim by the Long
Island Railroad Company and the Metropolitan Transportation Authority
(the "LIRR/MTA") for contribution and/or indemnification for any
liability resulting from actions against them in New York State Supreme
Court, Queens County (the "State Court Actions"), relating to the
explosion and fire at issue in this action. Porcelli and the Porcelli
Corporations have made a claim against Poling for property damage and for
contribution and/or indemnification in the event that they are found
liable in the State Court Actions.
Porcelli filed the present motion on October 29, 1991. Oral argument
was heard on November 13, 1991. The thrust of the argument in opposition
to the motion was that summary judgment was inappropriate at this time
because Porcelli had consistently blocked any attempts to ascertain facts
relevant to whether he may be held individually liable by piercing the
corporate veil of the Porcelli Corporations and to whether he personally
participated in the allegedly wrongful conduct leading to the fire and
explosion. The court instructed the parties that they would be allowed to
renew the deposition of Porcelli, at which the privilege would no longer
On December 17, 1991, Porcelli supplied the court with transcripts of
his renewed depositions, which were conducted on November 22, 1991 and
December 12, 1991. The motion was considered fully submitted as of that
Because neither Poling nor the LIRR/MTA have pleaded disregard of the
corporate form as a basis for Porcelli's liability,*fn1 any facts
relating to the question of whether the corporate veil may be pierced are
not material and do not create genuine issues for trial.
Poling asserts that it is entitled to contribution and/or
indemnification from Porcelli and the Porcelli Corporations because
"[t]he injuries, losses and damages alleged in [the] claims in this
action . . . were caused, in whole or in part, by faults and negligence
on the part of [Porcelli and the Porcelli Corporations]." Poling
Counterclaim ¶ THIRD. Likewise, the LIRR/MTA states as the basis of
its claim for contribution and/or indemnification against Porcelli and
the Porcelli Corporations "the active carelessness, recklessness and
negligence of said claimants with respect to maintenance, inspection and
repair of facilities at the Ditmas terminal premises, and with respect to
their actions concerning the discharge of gasoline on December
27-December 28, 1986." LIRR/MTA Claim and Amended Answer ¶¶ TWELFTH &
Under New York law, "corporate officers may be held personally liable
for personal torts committed in the performance of their duties for their
corporation." Westminster Constr. Co. v. Sherman, 160 A.D.2d 867, 868,
554 N.Y.S.2d 300, 301 (2d Dept. 1990); Widlitz v. Scher, 148 A.D.2d 530,
530, 540 N.Y.S.2d 179, 179 (2d Dept. 1989); Bellinzoni v. Seland,
128 A.D.2d 580, 580, 512 N.Y.S.2d 846, 847 (2d Dept. 1987); Clark v. Pine
Hill Homes, Inc., 112 A.D.2d 755, 755, 492 N.Y.S.2d 253 (4th Dept.
1985); Cleland v. Fort Ticonderoga Assoc., Inc., 71 A.D.2d 740, 740,
419 N.Y.S.2d 261, 262 (3d Dept. 1979).
Porcelli has repeatedly maintained that all terminal management and
maintenance responsibilities were delegated to other individuals and that
he made no decisions as to terminal repair and design. He testified that
after a previous spill, in October of 1986, it was terminal manager,
George Essayan, who investigated the accident and determined that the
proper course of action was to fire the dispatcher on duty at the time of
the spill. He testified, nevertheless, that "[w]e didn't find any fault
with the design of the terminal. We found fault with the dispatcher," and
that he concluded that there was no fault or defect in the design or
construction of the terminal because "[e]verything was functioning."
Porcelli Dep. Tr. (Dec. 12, 1991) at 13 (emphasis added). He further
testified that "I found the terminal to be sufficient and proper to
operate the way we have permits approved by the Fire Department of the
City of New York." Id. at 14 (emphasis added).
Mr. Porcelli also testified that after the December 1986 spill, which
forms the subject of this action, he personally made changes to channels
in the grading drainage system, building a retaining wall in the channel
to "avoid any spill into the street." Id. at 25-27, 41-42.
Taken together, this testimony raises a significant question as to
whether Porcelli exercised authority over and actually made decisions
having to do with terminal design and repair. Because negligence in the
design, inspection, and repair of the terminal are at issue in this
action, Porcelli's possible involvement in decisions relating thereto is
a genuine issue for trial. Therefore, ...