Defendant then retained his son-in-law, David Harrington, to install the floodlight. Mr. Harrington in turn hired plaintiff to assist him. Plaintiff was injured when he was attempting to thread electrical cable through the light standard's hollow center. The standard, which was being supported by a bucket chained to defendant's high lift tractor, broke loose and fell on Cannon, allegedly causing him to sustain severe physical injuries.
The Court of Appeals found that installing the outdoor light fixture was taken solely in connection with defendant's residential use of the property, notwithstanding that the work may have fortuitously affected another area of the property that was used for commercial activities. Therefore, the court examined the "site" (or location of the construction) and the "purpose" for which the construction was performed. The court held that the site was a neutral site on the grounds, attached to neither the residential or the commercial property. It found that the purpose of the light fixture was to illuminate defendant's front yard and his two artificial ponds. Therefore, the Court of Appeals held that the owner was entitled to invoke the exemption of Section 240(1).
The second test used by New York courts is the "use and sophistication" test, as set forth in Pigott v. Church of the Holy Infancy, 179 A.D.2d 161, 583 N.Y.S.2d 534 (3rd Dep't 1992), appeal denied 80 N.Y.2d 759, 602 N.E.2d 1125, 589 N.Y.S.2d 309 (1992). In Pigott, the defendant, a religious corporation, was the owner of a complex of buildings located on a single parcel of land in the Town of Lake Luzerne, New York. The complex consisted of a church, parish home, church hall, barn, and parking lot. Plaintiff was injured when he fell from the roof of the parish home on which he was performing roof reconstruction. The Third Department noted that when the owner does not occupy the dwelling for residential purposes, "the analysis focuses upon the use to which the structure is put and the sophistication of the owner, i.e. whether the owner had the requisite degree of business acumen to recognize the need to insure against the potential liability imposed by those statutes." Id, at 163, 583 N.Y.S.2d at 535.
Therefore, if the dwelling is used exclusively for commercial purposes, and the owner is, or should be, sophisticated enough to insure against the risk, the exception is inapplicable. The Pigott court held that the parish home was used exclusively as the personal residence for the priest serving the parish. In addition, the court noted that the dwelling was not commercial in nature because the defendant neither conducted business from the parish home, nor derived any financial gain therefrom. Finally, the court observed that although the parishioners derived some benefit from the presence of the clergy on the grounds of the church, any business gain was too insignificant to transform the use of the parish home into a commercial enterprise.
The third test derives from Van Amerogen v. Donnini, 78 N.Y.2d 880, 577 N.E.2d 1035, 573 N.Y.S.2d 443 (1991). This test is the "entirely and solely" test. In Van Amerogen, the defendants owned a house in Troy, New York, which had always been used for rental property. The court held that the defendants were not entitled to the exemption because the house was used entirely and solely for commercial purposes as income producing property. The defendants had always rented the house to college students. In addition, the court found that the defendants were not lacking in sophistication or business acumen so that they would fail to recognize the necessity to insure against the strict liability imposed by the statute.
The final test derived from Zahn v. Pauker, 107 A.D.2d 118, 486 N.Y.S.2d 422 (3rd Dep't 1985), applies when the same dwelling is used both as a residence and as a commercial venture. In Zahn, the dwelling was used both as a residence for the husband and wife and as a doctor's office for the husband. The court held that the exemption from strict liability was involuntarily waived because the dwelling was not used "solely" for residential purposes and did derive a commercial use.
The facts at bar more closely resemble the tests set forth in Pigott or Van Amerogen. This is so because the barn/silo complex was used for some commercial use, and arguably as well as residential use. Cannon would apply only if the work performed on the dwelling or on the real property was unrelated to the commercial structure. Clearly, in this situation the staining of the silo portion of the complex was not completely unrelated to the commercial structure, although the motive in staining the silo, according to the defendants, was merely to improve the looks of the overall property. Zahn does not apply because the defendant did not use the barn/silo complex for his own residence as well as any commercial use. In Zahn, the defendants actually resided in the dwelling. Here, although a tenant did reside in the silo, it was never occupied by the owner of the property or any of his family. Therefore, the court will first examine the "use and sophistication" test as set forth in Pigott.
As stated by the court in Pigott, the analysis focuses upon the use to which the structure is put, and the business sophistication of the owner. Defendant claims that he is entitled to the exemption under New York State Labor Law § 240(1) because the use of the property was never exclusively for commercial purposes; he argues that the barn portion of the barn/silo complex is used to store personal equipment. However, "an owner's use of the property is commercial in nature . . . when it is held as a business asset, i.e., used by the owner in furtherance of the enterprise whose purpose is the derivation of financial and business gain." Pigott, 179 A.D.2d 163 at 163-64, 583 N.Y.S.2d at 535.
The exemption was enacted to protect those people who, lacking business sophistication, would not know or anticipate the need to obtain insurance to cover them against liability imposed under § 240(1). It was not intended to insulate from liability owners who use their one or two family houses purely for commercial purposes. In those circumstances, the houses are more accurately considered as commercial enterprises than as one or two family houses . . . The exception is not applicable if the defendant's purpose in making renovations was to prepare the house for commercial rental.
Lombardi, 80 N.Y.2d at 297, 604 N.E.2d 120 at 120-21, 590 N.Y.S.2d at 58-59.
On the facts as before the court, the use of the silo in the past, up to and including the time of the accident, had been exclusively for rental income; and even before that as part of defendant's parents' dairy farm, both uses being commercial. In 1981, Miller moved into the silo and resided there at least on a full time basis, for nearly ten years, and then for the last year, on a part time basis. The defendant's family originally rented to Miller with the understanding that he would work on the interior of the silo in exchange for a rent free residence. On the other hand, the barn portion of the barn/silo complex was used for storing personal property of the defendant. The barn portion was never used, at least under defendant Bayard Kellam's ownership, as a farm for the derivation of financial gain. The barn was never occupied by anyone, including the defendant. In other words, the barn portion of the complex was never occupied as a dwelling. It is significant to note that the defendant Bayard Kellam treated the barn as income producing rental property on his 1989, '90, and '91 income taxes which demonstrates that its use was a commercial venture and not a residential building. In addition, the maintenance of a commercial rental property by painting, staining, and maintaining the grounds was not incidental to the commercial use of that portion of the property. Finally, although defendant does store some personal equipment in the barn, that use is merely incidental to the primary use of the barn/silo complex, that is, as a commercial venture. Pigott, 179 A.D.2d at 163, 583 N.Y.S.2d at 535 ("The relevant focus is upon the objective use to which the dwelling is put, not upon how the use is characterized from the owner's perspective.") (emphasis added).
As to the sophistication part of the test, plaintiffs claim that defendant's level of education, his choice of the proposal to use the less expensive scaffolding, and his ownership of at least two rental units
on his parcel of realty does not place him in a class of persons the legislature sought to exempt from the absolute liability provisions of Labor Law §§ 240 and 241. Plaintiffs also claim that since it is defendant's burden to prove entitlement to the exemption, Lombardi, 80 N.Y.2d at 297, 604 N.E.2d at 120-21, 590 N.Y.S.2d at 58-59, there is no proof that the defendant lacks the business sophistication to the extent necessary to avoid liability. Defendant, on the other hand, argues that he does lack the business sophistication necessary to avoid liability. Defendant argues that he did not purchase this land as an investment; rather he became the owner of the land in question as the result of a devise, and that the tenants "came with the land i.e., defendant's parents had leased to the tenants. He claims that he is only an English teacher and has no prior experience in contracting or construction. In addition, while he did negotiate an agreement with Perham, defendant maintains, and the evidence shows, that he clearly did not direct or control the work. Subsequent to his devise, his family resided in the primary dwelling as a permanent residence. During that time, the barn/silo complex was not only a residence used by Miller, but also served as a storage area for the equipment and tools used by a normal homeowner.
The court finds that the facts demonstrate that the defendant possessed the requisite business sophistication to impose absolute liability. The defendant rented to two different tenants on his property and had done so for at least one and one-half years prior to the accident. In addition, defendant declared the barn/silo complex as income producing property on his tax forms.
He apparently was aware of the advantages of a commercial venture. Defendant now must shoulder its disadvantage, namely absolute liability for injuries to those persons hired to improve his commercial property. Moreover, if defendant felt that he was unable to assume the responsibility of a landlord-tenant relationship, he could have unilaterally severed both by giving proper notice to the tenants.
The second analysis, the "entirely and solely" test established by the New York Court of Appeals in Van Amerogen, held that in order for absolute liability to attach, the property must be used exclusively for commercial purposes as income producing property. Defendant claims that the evidence clearly establishes that the barn and silo were a connected structure openly accessible from inside, and that the barn/silo complex was used by him for residential purposes in that he stored personal items there as well as for commercial uses. Therefore, he claims that the entirely and solely test has been destroyed by his residential use of the barn/silo complex.
However, as stated supra, the barn/silo complex was used exclusively for commercial purposes. Any residential use of the barn portion of the complex, i.e., to store personal equipment, was incidental to the primary use of the barn/silo complex, which was to generate income. Moreover, even before the tenant moved into the silo, defendant's parents used the complex as an integral part of their dairy farm business. As a result, plaintiffs' motion to impose absolute liability upon the defendant pursuant to Section 240 is granted.
SECTION 200 AND COMMON LAW NEGLIGENCE
Section 200 codifies the common law standard of negligence upon owners to protect the health and safety of their employees.
All places to which this chapter applies shall be so constructed, equipped, arranged, operated and conducted as to provide reasonable and adequate protection to the lives, health and safety of all persons employed therein or lawfully frequenting such places. All machinery, equipment, and devices in such places shall be so placed, operated, guarded, and lighted as to provide reasonable and adequate protection to all such persons. . . . .
N.Y.S. Labor Law § 200(1). "An implicit precondition to this duty to provide a safe place to work is that the party charged with that responsibility have the authority to control the activity bringing about the injury to enable it to avoid or correct an unsafe condition." Russin v. Louis N. Picciano & Son, 54 N.Y.2d 311, 317, 429 N.E.2d 805, 807, 445 N.Y.S.2d 127, 129 (1981). In addition, "it is settled law that where the alleged defect or dangerous condition arises from the contractor's methods and the owner exercises no supervisory control over the operation, no liability attaches to the owner under the common law or under Section 200 of the Labor Law." Lombardi, 80 N.Y.2d at 295, 604 N.E.2d at 119, 590 N.Y.S.2d at 57. Therefore, liability under Section 200 will attach only when the accident occurred due to a condition of the premises, as opposed to the manner in which the work was performed; and the owner exercised supervision or control over the work; or the owner had actual or constructive notice of the defective condition.
The evidence clearly demonstrates that the defendant did not control or supervise plaintiff's work, and he was not aware of any defective condition on the scaffolding; nor is it alleged that any condition on the barn/silo complex caused the accident. Therefore, defendant's motion to dismiss plaintiffs' Labor Law Section 200 and common law negligence claims is granted.
Therefore, this court finds that the defendant is not entitled to be exempt for the absolute liability imposed by Section 240(1) of the N.Y.S. Labor Law. Defendant has always used the barn/silo complex entirely and solely for commercial purposes and he possess sufficient business acumen to impose such liability. He is "quite unlike '[the] homeowner who hires someone to paint his own living room ceiling [who should be accorded the statutory exemption from strict liability]' and not within the class of persons the Legislature sought to exempt from the strict liability provisions of Labor Law §§ 240 and 241." Van Amerogen, 78 N.Y.2d at 883, 577 N.E.2d at 1037, 573 N.Y.S.2d at 445. Finally, such a determination places the "ultimate responsibility for safety practices . . . where such responsibility belongs, on the owner." Id, at 882, 577 N.E.2d at 1036, 573 N.Y.S.2d at 444 (citations omitted).
Accordingly, it is, ORDERED, that:
1. Plaintiffs' motion for partial summary judgment is granted;
2. Plaintiffs are granted summary judgment on the issue of liability pursuant to Section 240 of the Labor Law;
3. Defendant's cross-motion for summary judgment is granted in part and denied in part;
4. Defendant is granted summary judgment dismissing plaintiffs' common law negligence and Section 200 of the Labor Law claims; and
5. The remainder of defendant's motion is denied.
IT IS SO ORDERED.
David N. Hurd
U.S. Magistrate Judge
Dated: April 27, 1993
Utica, New York.