Opinion
# 2013-032-103 Claim No. 118281 Motion No. M-83966 Cross-Motion No. CM-84051
03-14-2014
CRANE HOGAN STRUCTURAL SYSTEM v. THE STATE OF NEW YORK
Claimant's attorney: Adams Bell Adams, P.C. By: Daniel P. Adams, Esq. Defendant's attorney: Hon. Eric T. Schneiderman, NYS Attorney General By: Michael T. Krenrich, Assistant Attorney General, Of Counsel
Synopsis Case information
UID: 2013-032-103 CRANE HOGAN STRUCTURAL Claimant(s): SYSTEM Claimant short name: CRANE HOGAN Footnote (claimant name) : Defendant(s): THE STATE OF NEW YORK Footnote (defendant name) : Third-party claimant(s): Third-party defendant(s): Claim number(s): 118281 Motion number(s): M-83966 Cross-motion number(s): CM-84051 Judge: JUDITH A. HARD Adams Bell Adams, P.C. Claimant's attorney: By: Daniel P. Adams, Esq. Hon. Eric T. Schneiderman, NYS Attorney General Defendant's attorney: By: Michael T. Krenrich, Assistant Attorney General, Of Counsel Third-party defendant's attorney: Signature date: March 14, 2014 City: Albany Comments: Official citation: Appellate results: See also (multicaptioned case) Decision
Defendant moves this Court for an order of summary judgment on the basis that the claim, which alleges defamation and injurious falsehood, fails to state a cause of action against the State of New York. Claimant opposes the motion and cross-moves for an order of summary judgment in its favor. For the reasons set forth below, defendant's motion is granted and claimant's cross motion is denied.
FACTS
On May 6, 2008, the New York State Office of General Services (OGS) awarded contract number D42910C (the Contract) for construction work to rehabilitate the parking garage and related systems at the Binghamton Government Center to Crane Hogan Structural Systems, Inc. (claimant). The work to be performed consisted primarily of removing and replacing areas of dilapidated concrete within the basement and subbasement of the Broome County Government Center Building in Binghamton, New York (the project). The removal of the dilapidated concrete was required, in many instances, to be performed by the use of chipping hammers and jackhammers.
On April 14, 2009, some of the concrete removal work was conducted. As a result of complaints by Broome County representatives that dust from the construction operations had entered the County's adjoining building during the prior evening, entry to the parking garage and the building above was prohibited on the morning of April 15, 2009. Later that day, the underground parking garage was only opened for construction work. That evening, Mark Pullyblank, who was employed by claimant as the project manager, received a telephone call from OGS's Engineer in Charge, Michael Murphy, telling him that the jackhammering was causing dust to enter the office building and was interfering with the County's environmental testing that was being conducted on the upper floors that evening. Mr. Murphy directed claimant to stop the work. Accordingly, Mr. Pullyblank shut down the chip hammering in the elevator room, but did not shut down the work in the adjoining equipment room. He instead shut the door and polyethylene was jammed below the closed door to prevent dust from entering the adjoining elevator room and shaft. A few minutes later, Mr. Pullyblank was told by the Deputy County Supervisor and the County Security Supervisor that the vibrations caused by the jackhammers and chipping hammers were interfering with the County's testing. Mr. Pullyblank immediately shut down all equipment operations at the site.
On April 16, 2009, the State, by Robert K. Palmer, Jr., as Director of the Division of Construction of the New York State Office of General Services, issued a directive indefinitely suspending claimant's work on the project (Claim, ¶ 5).
On April 16, 2009, Kendall Thorpe, OGS's Assistant Director of the Division of Construction, faxed a letter to claimant accusing Mr. Pullyblank of a "blatant disregard to explicit instructions and directions from the Director's Representative related to a specific health and safety issue the evening of April 15, 2009" (Claim, ¶ 6).
On April 20, 2009, James Davies, OGS's Deputy Commissioner of Design and Construction, sent a letter to claimant's insurance carrier blaming claimant for the dust problem in the office building, stating that claimant "failed to properly seal the [work] location during its work and caused concrete dust and debris to enter the sixth (6) floors of the County Offices located adjacent to the elevators at the site" and suggesting that as a result thereof the County Offices became substantially contaminated and caused "substantial disruption" to the County operations (Claim, ¶ 7).
Thereafter, claimant filed this claim alleging that the aforesaid statements constituted defamation and injurious falsehood.
LAW AND ANALYSIS
Summary Judgment
Summary judgment is a drastic remedy which should not be granted unless it is clear that there are no triable issues of fact (Andre v Pomeroy, 35 NY2d 361, 364 [1974]). The Court's function in a motion for summary judgment is not to resolve issues of fact, but to determine whether issues of fact exist (Barr v County of Albany, 50 NY2d 247, 254 [1980]).
The proponent of a motion for summary judgment must make a prima facie entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact (Alvarez v Prospect Hosp., 68 NY2d 320 [1986]). " 'Material' has been defined as 'substantial; of consequence; important; going to the essence or the merits; relating to matter of substance, rather than form' " (Wanger v Zeh, 45 Misc 2d 93, 96 [Sup Ct, Albany County 1965], citing Ballentine Dictionary, affd 26 AD2d 729 [3d Dept 1966]). A moving party's failure to demonstrate that there are no material issues of fact requires denial of a summary judgment motion, regardless of the sufficiency of the opposing party's papers (Winegrad v New York Univ. Med. Ctr., 64 NY2d 851 [1985]). However, once a moving party has demonstrated that there are no such material issues of fact, the burden shifts to the opponent of the motion to produce evidentiary proof, in admissible form, sufficient to establish the existence of material issues of fact which require a trial of the action (Alvarez, 68 NY2d 320; Winegrad, 64 NY2d 851; Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). The evidence must be viewed in the light most favorable to the opponent of the motion, and that party should be given every favorable inference (McKinnon v Bell Sec., 268 AD2d 220 [1st Dept 2000]).
CPLR § 3212 (b) states that a motion for summary judgment shall be supported by an affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions. A movant's failure to include relevant pleadings in his motion warrants a denial of summary judgment (Senor v State of New York, 23 AD3d 851 [3d Dept 2005]). Defamation
Defamation "is defined as the making of a false statement which tends to ' "expose the plaintiff to public contempt, ridicule, aversion or disgrace, or induce an evil opinion of him in the minds of right-thinking persons, and to deprive him of their friendly intercourse in society" ' " (Foster v Churchill, 87 NY2d 744, 751 [1996], quoting Rinaldi v Holt, Rinehart & Winston, 42 NY2d 369, 379 [1977], citing Sydney v MacFadden Newspaper Publ. Corp., 242 NY 208, 211-212 [1926]; Matovcik v Times Beacon Record Newspapers, 46 AD3d 636, 637 [2d Dept 2007]; see also Knutt v Metro Intl., S.A. 91 AD3d 915, 916 [2d Dept 2012]). "Defamation is the injury to one's reputation, either by written expression (libel) or oral expression (slander)" (Penn Warranty Corp. v DiGiovanni, 10 Misc 3d 998, 1002 [Sup Ct, NY County 2005], citing Morrison v National Broadcasting Co., 19 NY2d 453 [1967]). In order to be actionable, a statement must convey a defamatory meaning (Rinaldi, 42 NY2d at 379-380). Whether the particular words complained of are susceptible of the defamatory meaning ascribed to them is a legal question to be resolved by the court in the first instance (James v Gannett Co., 40 NY2d 415, 419 [1976]). A corporation may maintain an action for defamation in a proper case in the same manner as an individual (Alianza Dominicana, Inc. v Luna, 229 AD2d 328, 329 [1st Dept 1996]).
The elements of defamation are: (1) a false statement; (2) the publication of said statement without privilege or authorization to a third party; (3) fault amounting at least to negligence on the part of the publisher; and (4) the statement causes special harm or constitutes defamation per se (Dillon v City of New York, 261 AD2d 34, 38 [1st Dept 1999]; Restatement [Second] of Torts § 558).
There are four categories of statements that are libelous per se. They are statements: "(i) charging plaintiff with a serious crime; (ii) that tend to injure another in his or her trade, business, or profession; (iii) that plaintiff has a loathsome disease; or (iv) imputing unchastity to a woman" (Liberman v Gelstein, 80 NY2d 429, 435 [1992]; see Civil Rights Law § 77). If a statement is libelous per se, the law presumes that damages result and need not be separately proved (Penn Warranty Corp., 10 Misc 3d 998).
"Special damages contemplate 'the loss of something having economic or pecuniary value'" (Liberman, 80 NY2d at 434-435, quoting Restatement [Second] of Torts, § 575, comment b). They must be fully and accurately enumerated and a failure to itemize them constitutes an insufficient statement of such damages (Drug Research Corp. v Curtis Publ. Co., 7 NY2d 435, 440-441 [1960]).
A pleading in an action for defamation must set forth the particular words complained of (CPLR 3016 [a]) and must allege the time when, place where, and manner in which the false statement was made, and specify to whom it was made (see Dillon, 261 AD2d at 38).
The claim herein alleges that the defamatory statements are the letters written by Mr. Palmer, Mr. Thorpe and Mr. Davies (Claim, ¶ 10). However, the claim does not identify the particular words used by Mr. Palmer that claimant is alleging are defamatory. Accordingly, to the extent claimant alleges that a statement or statements by Mr. Palmer were defamatory, that portion of its claim must be dismissed.
As to the other statements alleged to be defamatory, there appear to be two. The first refers to a letter from Mr. Thorpe to claimant on April 16, 2009, in which Mr. Thorpe accuses Mr. Pullyblank of "a blatant disregard to explicit instructions and directions from the Director's Representative related to a specific health and safety issue the evening of April 15, 2009." The second refers to a letter from Mr. Davies to claimant's insurance carrier on April 20, 2009, in which Mr. Davies blames claimant for the dust problem in the office building and states that "claimant 'failed to properly seal the [work] location during its work and caused concrete dust and debris to enter the sixth (6) floors of the County Offices located adjacent to the elevators at the site' and suggesting that as a result thereof the County Offices became substantially contaminated and caused 'substantial disruption' to the County operations" (Claim, ¶ 7).
As to said statements, defendant argues that they are not susceptible of a defamatory meaning. The Court agrees.
To find defamation with respect to one's business, profession or occupation, it is essential that the allegedly offensive writing charge the claimant with being ignorant, incompetent, or incapable of his calling and thereby tend to injure him in that capacity (Amelkin v Commercial Trading Co., 23 AD2d 830 [1st Dept 1965], affd 17 NY2d 500 [1966], citing Kleeberg v Sipser, 265 NY 87 [1934]. " 'Language charging a professional man with ignorance or mistake on a single occasion only and not accusing him of general ignorance or lack of skill cannot be considered defamatory on its face and so is not actionable unless special damages are pleaded' " (Amelkin, 23 AD2d 830, 831, quoting November v Time, Inc., 13 NY2d 175, 178 [1963]).
In the present case, the letter from Mr. Thorpe to claimant on April 16, 2009, in which Mr. Thorpe accuses Mr. Pullyblank of "a blatant disregard to explicit instructions and directions from the Director's Representative related to a specific health and safety issue the evening of April 15, 2009" references a singular occurrence and as set forth in detail below, special damages have not been pleaded.
Moreover, as set forth by defendant, the April 16, 2009 letter from Mr. Thorpe to claimant simply conveys OGS's right to request the dismissal of its designated supervisor pursuant to Article 6 of the General Conditions of the contract.
In addition, the April 20, 2009 letter from Mr. Davies to claimant's insurance company (Travelers Indemnity Company) merely puts the insurance company on notice of a potential claim.
The aforesaid statements cannot be interpreted as having a defamatory meaning or exposing claimant to public contempt, ridicule, aversion or disgrace, or induce an evil opinion of it in the minds of right-thinking persons, and to deprive it of friendly intercourse in society, particularly in the first statement where the alleged defamatory comment is directed at Mr. Pullyblank, not claimant (see Carlucci v Poughkeepsie Newspapers, 57 NY2d 883 [1982]).
The Court agrees with defendant that to the extent the statements complained of could be characterized as an unfavorable assessment of the work performance of claimant, they are not actionable. Communications which amount to a subjective characterization of an employee's behavior and an evaluation of said employee's job performance, constitute non-actionable expressions of opinion (Farrow v O'Connor, Redd, Gollihue & Sklarin, LLP, 51 AD3d 626 [2d Dept 2008]).
Even if the alleged statements were susceptible of defamatory meaning, claimant's cause of action for defamation would need to be dismissed because claimant has failed to allege special damages in its claim. Alleging special damages is essential where the alleged statements are not defamatory per se. As set forth herein above, the alleged statements do not constitute defamation per se, because they relate to a single occurrence of misconduct and further, because they cannot be reasonably construed as imputing to claimant an overall incompetence or unfitness for its particular business, trade or profession. Accordingly, even if claimant met every other element of a defamation cause of action, its failure to allege special damages requires that the claim be dismissed.
The claim would also be dismissed on the basis of qualified privilege. While an absolute privilege is invoked when compelling public policy requires that the speaker be immune from suit, a qualified privilege is invoked for statements fostering a lesser public interest (O'Neill v New York Univ., 97 AD3d 199 [1st Dept 2012]). A qualified privilege must be pleaded and proved (Garriga v Townsend, 285 App Div 199 [3d Dept 1954]). Defendant has pled privilege as a defense.
To establish such a privilege, defendant needs to submit proof establishing that it was objectively reasonable for the defendant to believe that its conduct was appropriate under the circumstances (Hayes v City of Amsterdam, 2 AD3d 1139 [3d Dept 2003]). A privilege will attach to statements in which the communicating party possesses a legal duty to communicate information about another, if the communicator has a good-faith belief that the information is true (Chase v Grilli, 127 AD2d 728, 729 [2d Dept 1987]).
Once the defendant establishes that a communication is entitled to a qualified privilege, the burden shifts to claimant to show that defendant, in making the communication, was motivated by malice (Park Knoll Assoc. v Schmidt, 59 NY2d 205 [1983]). There are two types of malice: common law malice which is defined as meaning spite or ill will, and constitutional malice which is " 'knowledge that [the statement] was false or ... reckless disregard of whether it was false or not' " (Liberman, 80 NY2d at 437-438, quoting New York Times Co. v Sullivan, 376 US 254, 279-280 [1964]). Both types of malice will suffice to defeat a qualified privilege (Liberman, 80 NY2d at 438). To establish common law malice, claimant needs to prove that malice was the one and only cause for the publication (Feldschuh v State of New York, 240 AD2d 914, 916 [3d Dept 1997]; Liberman, 80 NY2d at 438). To establish that defendant was motivated by constitutional malice (also known as actual malice), claimant needs to prove that the communication was made with a high degree of awareness of its probable falsity (id.).
In the present case, defendant argues that the letters containing the defamatory statements were made by persons with an interest in the subject of the statements and were published only to persons with a corresponding interest, thereby affording them the protection of qualified privilege. The Court agrees.
Under the terms of the contract, which was annexed to defendant's motion as Exhibit A, the Director of Construction at OGS could require claimant to dismiss any employee "for any cause" should the Director deem such employee incompetent, negligent or for any cause unfit (Exhibit A, Article 6.2 of the General Conditions, Document 007213-4). Pursuant to the Affidavit of Kendall R. Thorpe, as the Assistant Director of Design & Construction for OGS, Mr. Thorpe was authorized to draft and send the April 16, 2009 letter to Crane Hogan for the sole purpose of exercising OGS's right and the letter specifically references the article of the contract pursuant to which he was writing.
Finally, Article 19 of the General Provisions of the contract requires that the State of New York be listed as an additional insured on all insurance policies required under the contract (Exhibit A, Article 19 of the General Conditions, Document 007213-12). The Certificate of Insurance, annexed to defendant's motion as Exhibit B, states that Travelers Indemnity Company was the general liability insurer at the time of the subject incident. Pursuant to the terms of the insurance policy, which is annexed to defendant's motion as Exhibit C, defendant, as an additional insured, was required to provide Travelers Indemnity Company with written notice of any occurrence or offense which may result in a claim and written notice of any suit as soon as reasonably possible (Exhibit C, Blanket Additional Insured [Contractors] - New York, p. 66, § 5). The first paragraph of the April 20, 2009 letter from Mr. Davies to Travelers Indemnity Company clearly states that the letter is to advise of a potential claim.
Because the alleged defamatory statements contained in the April 16, 2009 and April 20, 2009 documents were made by individuals with an interest in the subject of the statements and published only to persons with a corresponding interest, they are protected by a qualified privilege (Foster v Churchill, 87 NY2d 744 [1996]; Liberman, 80 NY2d at 437). Accordingly, the burden shifts to claimant to show that the statements were motivated by malice. Claimant has failed to establish the same.
In light of the foregoing, claimant's causes of action alleging defamation are without merit and must be dismissed.
Injurious Falsehood
Injurious falsehood is a tort that:
is committed when a person utters a false and misleading statement harmful to the interests of another if (1) the statement is uttered or published maliciously and with intent to harm another or done recklessly and without regard to its consequences, and (2) a reasonably prudent person would or should anticipate that damage to another will naturally flow therefrom. Thus, a [claimant] sufficiently states a cause of action for injurious falsehood by identifying specific representations, allegedly made by the defendants, which underlie the cause of action, and by alleging special damages sustained as result of the defendants' alleged publication of an injurious falsehood (43A NY Jur 2d, Defamation and Privacy § 5; see Hirschhorn v Town of Harrison, 210 AD2d 587, 588 [3d Dept 1994]).Defendant argues that claimant's pleadings are insufficient to support a cause of action for injurious falsehood because it has failed to allege special damages. The Court agrees and dismisses said cause of action (see Wasserman v Maimonides Med. Ctr., 268 AD2d 425, 426 [2d Dept 2000]).
CONCLUSION
Based upon the foregoing, defendant's motion for summary judgment is granted and the claim is dismissed. Claimant's cross-motion is denied as moot.
March 14, 2014
Albany, New York
JUDITH A. HARD
Judge of the Court of Claims
Papers Filed: Claim, filed April 15, 2010; and Verified Answer, filed May 24, 2010.
Papers Considered:
1. Notice of Motion, dated August 30, 2013; Affirmation in Support, affirmed by Michael T. Krenrich, AAG, on August 30, 2013, with Exhibits; Affidavit of Kendall R. Thorpe, P.E., sworn to August 28, 2013, with Exhibit; and Affirmation of Kieran P. Broderick, affirmed on October 1, 2013, with Exhibits.
2. Notice of Cross Motion, dated September 25, 2013; Affirmation of Daniel P. Adams, Esq., affirmed September 25, 2013, with Exhibits.
3. Attorney Sur-Reply Affirmation, affirmed by Daniel P. Adams, Esq., on October 29, 2013, with Exhibit.
4. Correspondence of Michael T. Krenrich, AAG, on November 6, 2013.
5. Affirmation in Reply of Michael T. Krenrich, AAG, affirmed October 1, 2013, with Exhibit.
The Court exercised its discretion pursuant to CPLR 2214 and considered claimant's sur-reply over the objection of defendant.