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FGR Realty, LLC v. Verizon, New York, Inc.

Other Lower Courts

December 3, 2007

FGR Realty, LLC, Plaintiff,
Verizon, New York, Inc., Defendant. Verizon New York, Inc., Third-Party Plaintiff, McFarland-Johnson, Inc., Third-Party Defendant.

Editorial Note:

This case is not published in a printed volume and its disposition appears in a table in the reporter.


McDONOUGH & ARTZ, P.C., By: Kevin F. McDonough, Esq., Attorneys for Plaintiff

PHILLIPS LYTLE, LLP By: William D. Christ, Esq., Attorneys for Defendant/Third-Party Plaintiff

LEVENE, GOULDIN & THOMPSON, LLP, By: Michael R. Wright, Esq. Attorneys for Third-Party Defendant


Phillip R. Rumsey, J.

The present action has its genesis in a construction project undertaken by plaintiff FGR Realty, LLC, owner of a shopping plaza, in 2003. Plaintiff apparently contracted with the third-party defendant McFarland-Johnson, Inc. (hereinafter McFarland), a professional engineering firm, to perform specified services in connection with the project, which involved bridging over and enclosing an open storm water channel. Among other things, McFarland was to draw up plans for the project and coordinate with other entities such as utility companies with underground facilities in the area, that might be affected by the construction activities (Affidavit of Michael R. Wright, Esq., dated June 4, 2007, 17).

To that end, a utility coordination meeting was commenced on October 29, 2003, and continued the following day at the construction site. A representative of defendant Verizon New York, Inc. (hereinafter Verizon) was present at both meetings (Wright Affidavit, Exhibit B [Answer to Amended Complaint, dated October 24, 2006], 10, 17), but allegedly failed to inform plaintiff of the location of an underground utility line belonging to that company (Wright Affidavit, Exhibit A [Amended Complaint, dated September 29, 2006], 20-21). The line was discovered after the excavation had begun, in a location inconsistent with the planned modifications. Plaintiff alleges that Verizon's negligence and trespass caused delay, additional planning and construction expense, and damage to plaintiff's property.

Verizon then commenced a third-party action against McFarland, seeking indemnification and/or contribution (Wright Affidavit, Exhibit C [Third-Party Complaint, dated May 9, 2007]). McFarland now moves for dismissal of the Third-Party Complaint, pursuant to CPLR 3211 (a), on the ground that it fails to state a viable cause of action.

The indemnification claim must be dismissed. There is no allegation of any contractual obligation undertaken by McFarland to indemnify Verizon. Nor has Verizon alleged facts that would establish a basis for implied indemnification, which is generally available only to a party that may be found liable without actual fault, as, for example, where the law imposes vicarious liability (e.g., liability of an employer for the acts of its employee, or liability of a vehicle's owner for the acts of a driver) ( see, Trustees of Columbia Univ. v Mitchell/Giurgola Assocs., 109 A.D.2d 449, 452-453 [1985]). In this case, plaintiff is suing Verizon for its own wrongdoing, not on the basis of vicarious or other legal liability without fault. Plaintiff will only succeed on its claim if there is a finding of actual fault (e.g., negligence, or other tortious conduct) by Verizon, in which case Verizon will not be entitled to indemnification. And if Verizon is found to be without fault, it will not have to pay any damages to plaintiff, that could be recovered over from McFarland ( see, id., at 453-454; Board of Educ. of City of New York v Mars Assocs., Inc., 133 A.D.2d 800, 801 [1987]).

Turning to the claim for contribution, McFarland maintains that because it had a contractual relationship with plaintiff, and contribution is only available in cases of tort liability, the claim must be dismissed. A contribution claim may only be sustained where (1) the plaintiff's claim against the defendant sounds (at least partly) in tort (see, Board of Educ. of the Hudson City School Dist. v Sargent, Webster, Crensaw & Folley, 71 N.Y.2d 21, 28 [1987]; Tower Bldg. Restoration, Inc. v 20 E. 9th St. Apt. Corp., 295 A.D.2d 229, 230 [2002]), (2) the third-party defendant allegedly breached a duty, separate from any contractual obligation, either to the plaintiff or to the defendant (see, Garrett v Holiday Inns, Inc., 58 N.Y.2d 253, 261 [1983]; Trustees of Columbia Univ., at 454), and (3) that breach allegedly caused or contributed to the injury for which plaintiff seeks to recover in the main action (see, Nassau Roofing & Sheet Metal Co. v Facilities Dev. Corp., 71 N.Y.2d 599, 603 [1988]).

The first criterion (which addresses the issue of whether the damages sought in the underlying claim are those for which contribution may be sought) is clearly met here, for plaintiff's claim against Verizon sounds only in tort - negligence and trespass. No contract between plaintiff and Verizon has been alleged, nor does it appear that there was one. If plaintiff does not succeed in proving negligence (i.e., the existence of a duty owed by Verizon to plaintiff, and a breach of that duty resulting in damages) or trespass - both torts - there will be no recovery on the main claim. And if plaintiff does establish the elements of one or both of its causes of action, the resulting liability will necessarily be of the type with respect to which contribution may be sought.

The second criterion (which, in essence, constitutes an analysis of whether the third-party defendant is also a "tortfeasor," from whom contribution may be sought) may be satisfied by proof that the third-party defendant breached a tort duty owed to the plaintiff, or to the defendant seeking contribution. At this early stage of the litigation, neither of those possibilities can be ruled out. Although McFarland evidently had a contract with the plaintiff, neither the existence of a contract, nor the fact that the contract may expressly obligate a professional to act in a manner consistent with the standards governing the profession, eliminates the independent duty arising from the professional relationship (breach of which would constitute the tort of malpractice) (see, Matter of R.M. Kliment & Frances Halsband, Architects and McKinsey & Co., Inc., 3 N.Y.3d 538, 542-543 [2004]; Tower Bldg. Restoration, at 229-230). The allegations of the third-party complaint, that McFarland was negligent in "designing, planning and/or coordinating the project," and more specifically, in failing to provide Verizon with copies of the plans for the project, and failing to ask Verizon to identify its facilities at or near the existing storm water channel, could state a claim of ...

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