Opinion
Index No. EF2021562
06-24-2024
Peter J. Hickey. Esq. Peter BaJouskas. Esq. Harding Mazzotti, LLP Allorneys.for the Plaintiff. David W. Nusbaum Nicole Licata-McCord, Esq. Sobel Pevzner LLC Allorneys for Defendants. 1./55 Washington Avenue LLC and 7-Eleven, Inc. Scott W. Bush, Esq. Corrigan, McCoy & Bush, PLLC Attorneys for Defendant/Third-Party Plaintiff Stratus Unlimited, LLC dlbla Stratus slhla MC Group/ Icon dlbla Stratus Sean A. Tomko. Esq. Santacrose & Frary Attorneys/or Third-Party Defendant, Top Line Ltd., Inc. dlbla AJ Sign Co.
Unpublished Opinion
Peter J. Hickey. Esq. Peter BaJouskas. Esq. Harding Mazzotti, LLP Allorneys.for the Plaintiff. David W. Nusbaum
Nicole Licata-McCord, Esq. Sobel Pevzner LLC Allorneys for Defendants. 1./55 Washington Avenue LLC and 7-Eleven, Inc.
Scott W. Bush, Esq. Corrigan, McCoy & Bush, PLLC Attorneys for Defendant/Third-Party Plaintiff Stratus Unlimited, LLC dlbla Stratus slhla MC Group/ Icon dlbla Stratus
Sean A. Tomko. Esq. Santacrose & Frary Attorneys/or Third-Party Defendant, Top Line Ltd., Inc. dlbla AJ Sign Co.
DECISION &ORDER
KUPFERMAN. J.,
The plaintiff was employed by the third-party defendant ("AJ Sign" or the "employer"). He fell from a ladder that had been provided by his employer while working at a building in Albany. He has indicated that no one other than his employer and co-worker told him how to perform the work and that he used his employer's equipment. The building's tenant ("7-Eleven" or "tenant") apparently requested the work (sign replacement) through a project management firm ("LSI"). LSI then apparently requested another entity, the moving defendant ("Stratus") to perform the work and/or arrange for the work to be performed. Stratus selected the plaintiff s employer to perform the work and issued a purchase order to the plaintiff's employer for the work.
In this action, the plaintiff seeks to recover monetary damages from the property owner (the "LLC" or "title owner"), the tenant, and Stratus. The complaint asserts claims based on Labor Law7 §§ 200. 240(1). 241(6) and negligence. The LLC and 7-Eleven have filed cross claims against Stratus for indemnification and contribution, and Stratus has filed a third-party complaint against the plaintiff's employer for contractual indemnification, among other things.
As a result of the incident, the plaintiff received workers' compensation benefits.
Stratus now seeks summary judgment dismissing the complaint and the cross claims asserted against it (see CPLR 3212). Specifically. Stratus alleges that it is not a proper defendant under the Labor Law; that it did not supervise or control the work; that it did not control the means or methods of the work; and that it did not tell the plaintiff how to perform his job. In support of the motion. Stratus relies primarily on three deposition transcripts and an affidavit from its representative (the Vice President of Field Partner Management).
In opposition to the motion, the plaintiff has submitted an attorney affirmation (without exhibits), a memorandum of law. and a response to Stratus' statement of facts. In addition, the remaining defendants (the LLC and 7-Eleven) have submitted an attorney affirmation (without exhibits) in partial opposition to the motion. They oppose the dismissal of their cross claims for common law indemnification and contribution.
The Deposition Testimony
In support of its motion. Stratus relies on the deposition testimony of a representative for both the tenant (7-Eleven) and the title owner (the LLC), as well as the testimony of the plaintiff. The tenant's representative (a construction manager employed by 7-Eleven in a different state) confirmed that in his experience 7-Eleven has arranged for sign replacement projects through LSI. He testified that he was not involved in the project, that he had never visited the work site, that he did not recognize the name Stratus, and that he did not know if a master agreement existed. He explained that a different construction manager handled the subject geographical area (Albany) at the time of the incident. That person, however, no longer works for 7-Eleven.
The LLC's representative testified that the LLC was set up after his mother passed away. Only the witness and his brother were members/personnel of the LLC. The property was leased by a convenience store (7-Eleven). and the LLC did not play any role in the operation of the business. The witness lacked personal knowledge of the subject incident and the work performed. He was unaware of the sign change. He was unaware of Stratus before the lawsuit. He did not know that the sign was being replaced. He did not know who supplied the equipment. He did not believe that the LLC had the authority to direct the work performed. He did not know who supervised the work.
The plaintiff testified that his employer at the time (AJ Sign) manufactures and installs various signs and vinyl graphics. He worked as a vinyl graphics technician. The accident occurred in December 2020. On the day of the accident, he traveled to the work site with a co-worker. He believed that his employer owned the vehicle, the supplies, and the equipment. They had a ladder, and he believed his co-worker had the paint supplies. It was his understanding that an old existing sign had been removed and that the face of the building needed to be painted. The plaintiff testified that on the day of the incident they were only going to prepare and paint the area where the old sign had been removed. He was applying tape to the building when he fell from the ladder. His co-worker was not present at the time. The sidewalk where the ladder was placed was level and had no holes or cracks. No part of the ladder was leaning against the building.
The purchase order issued by Stratus to the plaintiff"s employer described the work as including the removal of the old sign, painting in the area w here the old sign was located, and the installation of a new sign.
The plaintiff testified that he never saw any purchase orders for the job. He had never heard of Stratus. On that day. no one identified themselves to him as a person who was working for Stratus. To his knowledge, he had never worked with a company named Stratus. He did not speak to any employees of 7-Eleven until after the accident occurred. No one gave him any instructions about what to do other than his co-worker and his boss. No one from 7-Eleven was supervising or providing equipment.
The Supporting Affidavit
In the affidavit from Stratus' representative, the affiant explains that Stratus is a sign manufacturer and service company located in Ohio. The affiant oversees the team that hires and manages a subcontractor network for Stratus. Her team does not include project managers and service managers who directly hire the subcontractors for specific projects. She has never been to the location where the plaintiff was working, however, she has reviewed "the file" in this matter.
The affiant avers that LSI is a third-party entity from which Stratus receives work. She has provided a copy of the purchaser order ("PO") from LSI and assumes that 7-Eleven hired LSI. Stratus sent a PO to the plaintiff's employer for the work. The affiant avers that Stratus did not have direct agreements with 7-Eleven with respect to the sign work. Stratus also did not have any master service agreements with LSI. The work for LSI was performed on a case-by-case basis.
Shelly Vick was the project manager at the time, and she managed this specific sign project. She would have received the PO from LSI and issued the PO to the plaintiff's employer. Ms. Vick no longer works for Stratus. The affiant avers that Stratus does not usually send an employee to monitor the progress of a sign installation. She does not believe that Stratus or any general contractor ever went to the subject location. However, she was not personally involved.
She avers that Stratus does "thousands of these sign installs"; that it does "not have the capacity to manage every project"; and that it relies on its "sub-contractors/field partners.'' She avers that Stratus does not supply equipment for these projects and that its field partner (AJ Sign in this case) would provide the equipment. Based on her review of the file on this matter, she avers that no one from Stratus was at the work site; that no one from Stratus told the plaintiff how to go about doing his work; that Stratus did not provide the equipment; and that Stratus did not direct and control the plaintiff's work.
The Purchase Order and the Services Agreement (Viewed in the Light Most Favorable to the Non-Moving Parties)
As explained above. Stratus issued a purchase order to the plaintiff's employer to perform the work. The purchase order prohibited the plaintiff's employer from starting the work without proper protective equipment and required the plaintiff's employer to arrive "adequately supplied with materials, parts, tools and equipment... in good working condition and fit for the purpose to execute the scope of work."
The purchase order also required the plaintiff's employer to comply with state law and safety measures and perform the work in accordance with the drawings and specifications furnished by Stratus. The plaintiff"s employer also had to follow Stratus' recommended installation and attachment methods. If the recommended methods did not adequately address the specific circumstances encountered, the plaintiff's employer was further obligated to "contact Stratus for clarification and resolution." The plaintiff"s employer was also expressly referred to as Stratus' "agent" for the coordination and satisfactory completion of the work. The plaintiff's employer was also required to keep Stratus informed about the work and any injuries.
The purchase order further required the workers to "identify themselves upon arrival as representatives of Stratus'" and further instructed the workers to contact Stratus" project manager (Ms. Vick) to discuss work site issues. Stratus also had the right to refuse to accept the work "if such work product had quality defects in materials or workmanship or any unauthorized deviations from specifications." Stratus further reserved the right to cancel the agreement "at its election" in situations involving the employer's negligence, slow progress, or use of unsatisfactory materials or workmanship.
In addition to the purchase order. Stratus (also known as MC Group) had a services agreement with the plaintiff s employer (attached to the third-party complaint and relied upon by Stratus for its contractual indemnification claim). The agreement refers to the plaintiff's employer as a "field partner." In terms of safety, the services agreement required the plaintiff's employer to use only equipment in good working order and comply with all applicable safety laws and regulations. In addition, the plaintiff's employer was also required to comply with a detailed list of "minimum" safety standards and maintain commercial general liability insurance.
Under the services agreement. Stratus had the right to review all plans, invoices, and documents associated with the performance of the work and to discuss the services being performed with the workers. Stratus also had the right to seek injunctive relief if the plaintiff's employer breached. The plaintiff"s employer was also prohibited from assigning its rights without Stratus' consent.
Summary Judgment Standard
"Summary judgment is a drastic remedy and should not be granted unless there are no triable issues" (Michaelis v State of New York. 135 A.D.2d 1005. 1006 [3d Dept 1987]). The movant bears the initial burden of demonstrating "entitlement to judgment as a matter of law by proffering evidentiary proof in admissible form" (DiBartolomeo v St. Peter's Hosp, of the City of Albany. 73 A.D.3d 1326, 1326 [3d Dept 2010]; see CPLR 3212 [b]). If the moving party meets this initial burden, the burden then shifts to the party opposing the motion to raise a triable issue of fact (see DiBartolomeo. 73 A.D.3d at 1326). "The evidence must be viewed in the light most favorable to the nonmovant, and that party must be given the benefit of every favorable inference" (Parris-Kofi v Redneck, Inc.. 204 A.D.3d 1180, 1181 [3d Dept 2022]).
Labor Law $$ 240(1) and 241(6)
Stratus asserts that it is not a proper defendant under Labor Law §§ 240(1) and 241(6). According to Stratus, it was not an owner of the property, a general contractor, or a statutory agent; it did not supervise or control the work, control the means or methods of the work, or instruct the plaintiff about how to perform the job.
These sections of the Labor Law apply to only "contractors and owners and their agents" (Labor Law §§ 240; 241). With respect to title holders, the pattern jury instructions explain that liability "rests upon the fact of ownership" and that "it is generally irrelevant whether the owner has contracted for the work or benefited from it" (IB NY PJ13d 2:216, at 325 [2023] [citing cases]). A property owner, for example, may be held liable where a nexus exists between the owner and the work, such as a lease, even where the property owner lacked control over the work (see id. at pp. 325-330 [citing cases]).
The pattern jury instructions further explain that the term "owner" "is not limited to title holders" and may encompass "a lessee who contracted for or otherwise has the right to control the work" (id. at p. 324 [citing cases]; see generally id. at pp. 324-330). A lessee, for example, may be held liable as an "owner" if it hired the contractor or otherwise had the right to control the work (see id. at p. 330 [citing cases]). An entity is considered a "contractor" "if it has the power to enforce safety standards and choose responsible subcontractors ... or if it had the right to exercise control of the work, regardless of whether it actually exercised that right" (id. at p. 333 [citing cases]). "A defendant may be held liable as a general contractor ... even if it did not hire or contract with plaintiffs employer if the defendant was responsible for coordinating and supervising the entire construction project and was invested with concomitant power to enforce safety' standards and to hire responsible contractors" (id. at p. 333 [citing Lemiszko v Mosovich 2014 Family Trust. 191 A.D.3d 1363[4th Dept 2021]).
Further, an "owner or general contractor may not avoid liability under Labor Law §§ 240(1) and 241(6) by delegating the work" (id. at p. 334 (citing Kingston v Hunter Highlands. 222 A.D.2d 952 (3d Dept 1995)]). Where the work is delegated, "the third party has concomitant authority to supervise and control the work delegated and becomes an 'agent' of the general contractor for purposes of the Labor Law" (id. at pp. 334-335 [citing cases]). "Once an entity becomes an agent under the Labor Law. it cannot escape liability to an injured plaintiff by delegating the work to another entity" (id. at 335 [citing cases]).
In considering whether a defendant qualifies as an "agent." the Court must consider whether the third party possessed "the authority to supervise and control the work that [gave] rise to plaintiffs injuries" (id. at p. 335 [citing cases]). "The determinative factor on the issue of control is whether the third party has control of the work and the authority to insist that proper safety practices be followed" (id. at p. 335 [citing cases]). "A subcontractor's authority to supervise and control the plaintiff's work may be demonstrated by the terms of its subcontract and the fact that the contractor itself subcontracted a portion of the work to plaintiff's employer" (id. at p. 336 [citing cases]).
Here, the record supports a finding that the work was authorized by the tenant (7-Eleven), eventually delegated to Stratus, and then delegated by Stratus to the plaintiff's employer. The purchase orders and the services agreement further indicate that Stratus had authority over the work, the work site, and the safety'. As explained in detail above, the plaintiff's employer was required to follow the specifications provided by Stratus and comply with state laws and safety measures. Stratus further had the right to terminate the work (or withhold payment) if the plaintiff's employer was negligent or performed unsatisfactory work, the plaintiff's employer was also required to keep Stratus informed about the work and any injuries. In fact, the purchase order directed the plaintiff"s employer to contact Stratus' project manager to resolve issues. A telephone number was provided for this purpose. The services agreement further permitted Stratus to seek injunctive relief if the plaintiff"s employer breached. The plaintiff's employer also could not assign its rights without Stratus' consent.
That Stratus delegated the authority to the plaintiff's employer to perform the work and required it to be done safely raise an inference that Stratus had such authority, at least at some point. The purchase order in fact provides that the plaintiff's employer "assumes controlling contractor status for any and all work performed at the job site" and that the plaintiff's employer shall "act as Stratus' agent for coordination and satisfactory completion of work. Again, as discussed above. Stratus also reserved the right to cancel the contract (or any portion of it) or seek injunctive relief for a breach. Moreover, while several facts are unknown regarding what transpired in connection with the performance of the work, the record supports a finding that Stratus accepted the responsibly to perform the work and then delegated it to the plaintiff's employer to perform.
In addition, the papers submitted on the motion do not include any written document or satisfactory explanation setting forth the reason for the compensation promised to Stratus or the scope of services it agreed to perform for LSI. The absence of a written agreement between LSI and Stratus (or between Stratus and the LLC. 7-Eleven. or any general contractor) and Stratus' failure to explain the terms of its bargain or any oral agreements with LSI further create issues of fact precluding an award of summary judgment in its favor (see Nascimento v Bridgehampton Construction Corp. 86 A.D.3d 189. 194-195 ).
This case is remarkably similar to several cases decided under the Labor Law7 either granting summary judgment in favor of the plaintiff against the subcontractor or finding that triable issues of fact exist (see e.g. White v 31-01 Steinway. LLC, 165 A.D.3d 449 [1st Dept 2018]; Nascimento. 86 A.D.3d at 189; Weber v Baccarat. 70 A.D.3d 487 [1st Dept 2010J). In White, tor example, the plaintiff was employed as a sign installer and fell from a ladder. Express, the owner of a renovation project, hired Ruggles "as the sole contractor responsible for the manufacture and installation of all signage and awning work on the project, which was the work that plaintiff was performing when he sustained his injuries" (White. 165 A.D.3d at 452). Ruggles then delegated the signage and awning work to the plaintiffs employer. The appellate court concluded that Ruggles was "a proper Labor Law § 240 (1) defendant because it was a statutory agent of Express, the owner of the project" (id). The appellate court reasoned that. "Ruggles was delegated the supervision and control over such work" and that "Ruggles may not escape liability under Labor Law § 240 (1) based on its delegation of the signage and awning work to [the] plaintiffs employer" (id. at 452-453).
In Nascimento, the defendant subcontractor asserted that it did not coordinate or supervise the project and that it did not have the power to enforce safety standards (see 86 A.D.3d at 192). It also asserted that there was no formal written contract between it and the general contractor specifying that it had any such authority (see id. at 194). There was just a written proposal naming the work and its price, and the defendant's subcontract with another entity, which required this other entity to "provide all labor, tools, equipment, supervision and other items necessary to execute the ... work" (see id.). The appellate court concluded that issues of fact existed based on the delegation of the work and the subcontract (see id. at 194-195).
Similarly, in Weber, the plaintiff fell from a defective ladder while installing an HVAC system (70 A.D.3d at 487). The appellate court found that the plaintiff was entitled to summary judgment against the HVAC subcontractor. King Freeze, because "King Freeze had the authority to supervise and control the work being done by plaintiff pursuant to the terms of its subcontract" and that "it demonstrated this authority by subcontracting a portion of the HVAC work to plaintiff's employer" (id. at 488). The Court also observed that the existence of "overlapping authority" to supervise the work "did not negate King Freeze's authority to supervise and control the installation of the HVAC system" (id. Moreover, whether King Freeze actually supervised the plaintiff was "irrelevant" (id.; see also Iveson v Sweet Assocs. 203 A.D.2d 741, 742 [3d Dept 1994]).
Accordingly, when viewed in the light most favorable to the non-moving parties, the Court finds that issues of fact exist regarding whether Stratus acted as the "general contractor" or, alternatively, as an "agent" of the tenant (see Nascimento. 86 A.D.3d at 189; Weber. 70 A.D.3d at 487). That portion of the motion seeking to dismiss the Labor Law §§ 240 and 241 claims is therefore denied.
Labor Law $ 200 and Negligence
Stratus also seeks summary judgment dismissing the claims based on Labor Law § 200 and negligence. Stratus again asserts that it had no authority to supervise or control the plaintiff's work; that it did not control the means or methods of the work: and that it did not direct or control the work or supervise how it was done.
"Labor Law § 200 codifies an owner's, employer's and general contractor's common law duty to provide workers with a reasonably safe place to work" (IB NY PJI3d 2:216. at 370 [2023] [citing cases]). Such claims ''fall into two broad categories: those involving injuries arising from allegedly defective or dangerous premises conditions and those involving injuries arising from the manner in which the work is performed" (id. at p. 370 [citing cases]). General contractors may be "held liable for unsafe premises conditions if they created or had actual or constructive notice of the condition and also had control of place where the injury occurred" (id. at pp. 370-371 [citing cases]). In contrast, in cases arising from the manner in which the work was performed, "the owner or general contractor may be liable [under Labor Law § 200] only if it exercised supervision or control of the work that led to the injury" (id. at p. 371 [emphasis added] [citing cases]; see generally id. at pp. 371-385). "This analysis, which requires actual exercise of control, has been repeated in numerous Court of Appeals decisions" (id. at p. 379 [citing cases]).
Here, the record is not sufficiently developed to conclude as a matter of law that Stratus did not exercise supervision or control over the work, or that it did not act negligently. The Court has not been provided with any deposition testimony taken of Stratus. LSI. or the plaintiff's employer. In addition, the representative who testified for 7-Eleven admitted that he was not involved in the project. He did not even appear to have any familiarity with the facts of this case. Similarly, the Stratus employee who submitted an affidavit was not involved in the project (see e.g. Firth v State. 306 A.D.2d 666, 667-668 [3d Dept 2003]). While she appears to have at least reviewed "the file" (presumably Stratus' business records), she did not attach to her affidavit a copy of "the file" upon which she relied to reach her conclusions (see e.g. McFarland v Michel. 2 A.D.3d 1297, 1299 [4th Dept 2003]; Palo v Principio. 303 A.D.2d 478, 479 [2d Dept 2003]).
Moreover, while Stratus has provided a copy of the plaintiff's deposition transcript, the plaintiff's knowledge and observations were limited. He did not participate in the negotiations of the purchase orders or have any contact with any representatives of 7-Eleven. LSI, or Stratus. His presence at the work site also lasted a short period of time. He estimated that he was present for only 30 minutes to an hour before the accident occurred. He also visited the work site only after the prior sign was removed, and he presumably did not return to the work site after he was injured.
Accordingly, based on the limited facts presented, the Court finds that Stratus has not met its initial burden on this summary' judgment motion to demonstrate as a matter of law' that the Labor Law § 200 and negligence claims lack merit. That portion of the motion seeking summary judgment on these claims is therefore denied, without prejudice to Stratus' right to renew the issue during the trial or at such other time as appropriate.
The Court notes that, even though the plaintiff has not addressed this portion of the motion. Stratus has not met its initial burden on this motion to summarily dismiss these two claims as meritless. Notwithstanding, as a practical matter, the plaintiff should consider withdrawing the Labor Law § 200 and negligence claims if he does not have sufficient evidence to establish them at trial.
The Cross Claims
Stratus also seeks summary' judgment on the cross claims asserted against it. "Under appropriate circumstances, an owner or general contractor who is vicariously liable under Lab. Law' § 240 may obtain [common law] indemnification or when only partially at fault, may obtain contribution from the others who caused or contributed to the accident" (2 Warren's Negligence in the New York Courts § 37.05 [Bender 2024]; see CPLR 1401; Northacker v County of Ulster, 212 A.D.3d 86, 94 [3d Dept 2022]; Lagares v Carrier Term. Servs., Inc.. 204 A.D.3d 1456, 1459 [4th Dept 2022]; IB NY PJI3d 2:216. at 355-357 [2023] [discussing indemnification and contribution in actions under Labor Law §§ 240 and 241]).
A party may be entitled to common-law indemnification w hen it has been held vicariously liable without proof of any negligence or actual supervision on its own part (see McCarthy v Turner Constr., Inc., 17 N.Y.3d 369, 377-378 [2011]). "Contribution is proper where the culpable parties are subject to liability for damages for the same personal injury, 'whether or not the culpable parties are allegedly liable for the injury under the same or different theories'" (Held v Pike Co.. 140 A.D.3d 1664. 1665 [4th Dept 2016] [citation omitted]).
Further, a general contractor's or other agent's contractual authority "to supervise the work and implement safety procedures is not alone a sufficient basis for requiring common-law indemnification" (McCarthy. 17 N.Y.3d at 377-378). Liability for common law indemnification "may only be imposed against those parties (i.e.. indemnitors) who exercise actual supervision" (id. at 378). "Thus, if a party with contractual authority to direct and supervise the work at a job site never exercises that authority because it subcontracted its contractual duties to an entity that actually directed and supervised the work, a common-law indemnification claim will not lie against that party on the basis of its contractual authority alone" (id.; see also Agurto v One Boerum Dev. Partners LLC. 221 A.D.3d 442. 444 [1st Dept 2023]).
As discussed above, the record is not sufficiently developed to conclude as a matter of law that Stratus did not exercise supervision or control over the work, or that it did not act negligently (see Chapa v Bavles Props.. Inc.. 221 A.D.3d 855, 856-857 [2d Dept 2023]; 176 W. 87th St. Owners Corp, v Guercio. 216 A.D.3d 401. 40111 st Dept 2023]; Roblero v Bais Ruchel High Sch., Inc.. 175 A.D.3d 1446, 1448-1449 [2d Dept 2019]). Accordingly, the Court finds that issues of fact exist on these matters, thereby precluding summary dismissal of the cross claims for common law indemnification and contribution.
Further, the Court agrees with Stratus that no evidence supports a cross claim by the LLC or 7-Eleven for contractual indemnification against Stratus. Specifically, no evidence exists that Stratus had any contractual agreement with the LLC or 7-Eleven (White. 165 A.D.3d at 451; see also Chapa. 221 A.D.3d at 857). In addition, the LLC and 7-Eleven have not alleged that the agreement between LSI and Stratus provided for contractual indemnification or that they were a third-party beneficiary of any such agreement. Notwithstanding, the LLC and 7-Eleven have neither asserted a cross claim for contractual indemnification in their answer, nor have they otherwise sought to interject such a cross claim into this case. This issue is therefore a moot point.
It is therefore. ORDERED, that the motion of Stratus seeking summary judgment is DENIED, without prejudice.
This shall constitute the Decision and Order of the Court. The Court is hereby uploading the original decision into the NYSCEF system for filing and entry by the County Clerk. The Court further directs the parties to serve notice of entry in accordance with the Local Protocols for Electronic Filing for Saratoga County.
So-Ordered.