Hedges v East Riv. Plaza, LLCAnnotate this Case
Decided on January 17, 2018
Supreme Court, New York County
Michael Hedges, As Guardian Ad Litem of MARION HEDGES, An Incapacitated Person, and MICHAEL HEDGES, Individually, and DAYTON HEDGES, An Infant by his Father and Natural Guardian MICHAEL HEDGES, and MICHAEL HEDGES, Individually, Plaintiffs,
East River Plaza, LLC, TIAGO HOLDING, LLC, BLUMENFELD DEVELOPMENT GROUP, LTD., FOREST CITY ENTERPRISE, INC., FOREST CITY RATNER COMPANIES, INC., ERP MANAGEMENT LLC, PLANNED SECURITY SERVICE INC., TARGET CORPORATION, COSTCO WHOLESALE CORPORATION and BOB'S DISCOUNT FURNITURE OF NY, LLC, , Defendants. TIAGO HOLDING, LLC, BLUMENFELD DEVELOPMENT GROUP, LTD., FOREST CITY ENTERPRISE, INC., FOREST CITY RATNER COMPANIES, INC., ERP MANAGEMENT LLC, Third-Party Plaintiffs, JEOVANNI ROSARIO and RAYMOND HERNANDEZ, Third-Party Defendants. PLANNED SECURITY SERVICE INC., Second Third-Party Plaintiff, JEOVANNI ROSARIO and RAYMOND HERNANDEZ, Second Third-Party Defendants.
Attorneys for the Plaintiffs: Kramer Dillof Livingston & Moore, 217 Broadway, New York, NY 10007
Attorneys for Defendant/Third-Party Plaintiffs Blumenfeld Development Group, Forest City Ratner Companies, LLC, ERP Management, LLC, Tiago Holdings, LLC, and Forest City Enterprises, Inc.: Wilson, Else, Moskowitz, Edelman & Dicker, LLP, 1133 Westchester Avenue, White Plains, New York, 10604
Attorneys for Defendant/Second-Third Party Plaintiff Planned Security Service, Inc.: Pillinger Miller Tarallo LLP, 570 Taxter Road, Suite 275, Elmsford, NY 10523
Attorneys for Defendant/Third Third-Party Plaintiff Target Corporation: Simmons Jannace and Deluca LLP, 43 Corporate Drive, Hauppauge, NY 117788
Attorneys for Defendant Bob's Discount Furniture of NY, LL" target="_blank">Stonehill Capital Mgt. LLC v Bank of the West, 28 NY3d 439, 448 (2016); Alvarez v Prospect Hosp., 68 NY2d 320, 324 (1986); Zuckerman v City of New York, 49 NY2d 557, 562 (1980). Once such a showing has been made, the burden shifts to the non movant to produce evidentiary proof in admissible form to "establish the existence of material issues of fact which require a trial of the action." Alvarez, 68 NY2d at 324 (1986); see Zuckerman, 49 NY2d at 562.
The evidence must be viewed in a light most favorable to the nonmoving party (see Branham v Loews Orpheum Cinemas, Inc., 8 NY3d 931, 932 ), and the motion must be denied if there is any doubt as to the existence of a triable issue of fact, or where the issue is "arguable." See Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395, 404 (1957); Asabor v Archdiocese of NY, 102 AD3d 524, 527 (1st Dept 2013). However, "mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient" to raise a material question of fact. Zuckerman, 49 NY2d at 562.
Landlords and their managing agents have a common-law "'duty to exercise reasonable care in maintaining [their] . . . property in a reasonably safe condition under the circumstances.'" Powers v 31 E 31 LLC, 24 NY3d 84, 94 (2014), quoting Galindo v Town of Clarkstown, 2 NY3d 633, 636 (2004); see Peralta v Henriquez, 100 NY2d 139, 144 (2003); Kush v City of Buffalo, 59 NY2d 26, 29-30 (1983); Basso v Miller, 40 NY2d 233, 241 (1976). This duty includes an obligation "to take minimal precautions to protect tenants [and visitors] from foreseeable harm, including foreseeable criminal conduct by a third person." Mason v U.E.S.S. Leasing Corp., 96 NY2d 875, 878 (2001); see Jacqueline S. v City of New York, 81 NY2d 288, 293-294 (1993). Landlords thus "have a duty to act in a reasonable manner to prevent harm to those on their property" (D'Amico v Christie, 71 NY2d 76, 85 ) and "to minimize the foreseeable danger from criminal acts when past experience alerts it to the likelihood of criminal conduct on the part of third persons." Mason, 96 NY2d at 878. "In particular, they have a duty to control the conduct of third persons on their premises when they have the opportunity to control such persons and are reasonably aware of the need for such control." D'Amico, 71 NY2d at 85; see Pink v Rome Youth Hockey Assn., Inc., 28 NY3d 994, 997-998 (2016); Martino v Stolzman, 18 NY3d 905, 908 (2012). "[T]he existence and scope of an alleged tortfeasor's duty is usually a legal, policy-laden declaration reserved for Judges to make." Palka v Servicemaster Mgt. Servs. Corp., 83 NY2d 579, 585 (1994) (citations omitted).
Criminal conduct may be foreseeable if it was "'reasonably predictable based on the prior occurrence of the same or similar criminal activity at a location sufficiently proximate to the subject location.'" Maria T. v New York Holding Co. Assocs., 52 AD3d 356, 357 (1st Dept 2008), quoting Novikova v Greenbriar Owners Corp., 258 AD2d 149, 153 (2d Dept 1999); see Johnson v City of New York, 7 AD3d 577, 578 (2d Dept 2004). To demonstrate foreseeability, plaintiffs do not need to show that prior criminal activity was "at the exact location where plaintiff was harmed or . . . of the same type of criminal conduct to which plaintiff was subjected." Jacqueline S., 81 NY2d at 294; see Di Ponzio v Riordan, 89 NY2d 578, 584 (1997). Rather, foreseeability depends "on the location, nature and extent of those previous criminal activities and their similarity, proximity or other relationship to the crime in question." Jacqueline S., 81 NY2d at 295; see Mason, 96 NY2d at 878.
Where an incident "is within the class of foreseeable hazards that [a] duty exists to prevent, the [defendant] may be held liable, even though the harm may have been brought about in an unexpected way." Di Ponzio, 89 NY2d at 584; see Ard v Thomson & Johnson Equip. Co., 128 AD3d 1490, 1491 (4th Dept 2015). "Because questions concerning what is foreseeable . . . may be the subject of varying inferences, . . . these issues generally are for the fact finder to resolve. Derdiarian v Felix Contr. Corp., 51 NY2d 308, 315 (1980); see Hain v Jamison, 28 NY3d 524, 529 (2016); Turturro v City of New York, 28 NY3d 469, 484 (2016).
To establish liability for negligence, "[t]he plaintiff must also show that the defendant's negligence was a proximate cause of the injuries. To do so, the negligence must be a substantial cause of the events which produced the injury." Boderick v R.Y. Mgt. Co., 71 AD3d 144, 147 (1st Dept 2009), citing Derdiarian, 51 NY2d at 315. Conduct of a third party may break the causal connection between a defendant's negligence and a plaintiff's injury, and supercede a defendant's liability, where it "is of such an extraordinary nature or so attenuates defendant's negligence from the ultimate injury that responsibility for the injury may not be reasonably attributed to the defendant." Kush, 59 NY2d at 32-33. However, "[a]n intervening act may not serve as a superseding cause, and relieve an actor of responsibility, where the risk of the intervening act occurring is the very same risk which renders the actor negligent." Derdiarian, 51 NY2d at 316; see Mazella v Beals, 27 NY3d 694, 708 (2016); Kush, 59 NY2d at 33.
"The right of one party to shift the entire loss to another — indemnification — may be based upon an express contract" (Bellevue South Assoc. v HRH Constr. Corp., 78 NY2d 282, 296 ), "or may be implied 'based upon the law's notion of what is fair and proper as between the parties.'" McCarthy v Turner Constr., Inc., 17 NY3d 369, 374-375 (2011), quoting Mas v Two Bridges Assocs., 75 NY2d 680, 690 (1990). "A party is entitled to full contractual indemnification provided that the 'intention to indemnify can be clearly implied from the language and purposes of the entire agreement and the surrounding facts and circumstances.'" Drzewski v Atlantic Scaffold & Ladder Co., 70 NY2d 774, 777 (1987) (citations omitted).
"When a party is under no legal duty to indemnify, a contract assuming that obligation must be strictly construed to avoid reading into it a duty that the parties did not intend to be assumed." Campos v 68 E. 86th St. Owners Corp., 117 AD3d 593, 595 (1st Dept 2014), citing Hooper Assoc. v AGS Computers, 74 NY2d 487, 491-492 (1989); see also Rodrigues v N & S Bldg. Contrs., Inc., 5 NY3d 427, 433 (2005). "Where there is an ambiguity as to the meaning of a lease [*5]prepared by the landlord, the ambiguity should be resolved in favor of the lessee ." Campos, 117 AD3d at 595. Further, "[c]ourts will construe a contract to provide indemnity to a party for its own negligence only where the contractual language evinces an 'unmistakable intent' to indemnify." Great Northern Ins. Co. v Interior Constr. Corp., 7 NY3d 412, 417 (2006). Parties may, however, "freely enter into an indemnification agreement whereby they use insurance to allocate the risk of liability to third parties between themselves." Id. at 419; see Kinney v G.W. Lisk Co., 76 NY2d 215, 218 (1990) (distinction between agreement to procure insurance and agreement to indemnify is well recognized).
"Common-law indemnification is generally available 'in favor of one who is held responsible solely by operation of law because of his relationship to the wrongdoer.'" McCarthy, 17 NY3d at 375, quoting Mas, 75 NY2d at 690. Based on "a separate duty owed the indemnitee by the indemnitor" (id.), common-law indemnification permits "one who was compelled to pay for the wrong of another to recover from the wrongdoer the damages paid to the injured party." D'Ambrosio v City of New York, 55 NY2d 454, 460 (1982); see McCarthy, 17 NY3d at 375. It "arises from the principle that 'every one is responsible for the consequences of his [or her] own negligence'" (Raquet v Braun, 90 NY2d 177, 183  [citation omitted]), and "reflects an inherent fairness as to which party should be held liable for indemnity." McCarthy, 17 NY3d at 375.
The court turns first to the portions of the motions of Target, Costco and Bob's seeking dismissal of the complaint and all cross claims against them. As Target has settled with plaintiff, and all cross claims against it have been discontinued, this branch of its motion is denied as moot. See Oct. 2016 Stip.
For plaintiffs to establish negligence against Costco, as against any of the defendants, they must show that Costco owed them a duty and that its breach of that duty caused them to suffer damages. Costco moves to dismiss the complaint as against it on the grounds that it owed no legal duty to plaintiffs, and cannot be liable for plaintiffs' injuries, because the incident at issue did not occur on its premises.
It is undisputed that Plaintiff was hit by the shopping cart in a common area outside of Costco's store, on the first level of the shopping center near the parking garage pay station, which was, according to the testimony of Plaintiff's son, more than fifty feet from Costco's entrance. See Dayton Hedges Dep., Ex. D to Meade Aff. in Support of Costco's Motion (Meade Aff.), at 75-76. According to Plaintiff's son, after they exited Costco, they walked about fifty feet to the right, then turned left and crossed a roadway to get to the parking payment station at the entrance to the parking garage. Id.; see Photos, Ex. H to Rubino Aff. in Opp. to Costco (Rubino Aff.). Plaintiffs' negligence claim against Costco is based solely on allegations that Plaintiff and her son were in Costco before the incident occurred, Plaintiff was injured shortly after she left the store, and Costco was aware of prior incidents of objects being thrown off upper level railings of the shopping center.
As this court found on Costco's prior motion to dismiss, plaintiffs have not shown that Costco had a connection to or a duty of care toward the area where the incident occurred or toward the instrumentality that injured Marion Hedges. See Hedges v East Riv. Plaza, LLC, 43 [*6]Misc 3d 278, 285 (Sup Ct, NY County 2013), affd 126 AD3d 582 (1st Dept 2015). The questions left open in the court's prior decision were "whether plaintiffs were injured in an area necessary for egress from or ingress to Costco Wholesale and where store employees and management were aware of imminent danger from overhead" (43 Misc 3d at 286), and if so, what was Costco's duty to customers exiting or entering the store. Id. at 287.
Business proprietors, like property owners, have a duty to take minimal precautions to protect others from foreseeable criminal conduct of third persons on their premises. See D'Amico, 71 NY2d at 85. That duty does not, generally, extend to areas outside a defendant's premises over which it had no control. See Taft v Connell, 285 AD2d 992 (4th Dept 2001) ("duty of defendant to protect plaintiff from foreseeable harm caused by third persons was limited to conduct on defendant's premises); Del Bourgo v 138 Sidelines Corp., 208 AD2d 795 (2d Dept 1994) (same); see also D'Amico, 71 NY2d at 85. Costco thus did not, generally, have a duty to protect members of the public from criminal activity in the common areas of the shopping center outside its premises. See Guarcello v Rouse SI Shopping Ctr., 204 AD2d 685 (2d Dept 1994) (video arcade operator had no duty to protect plaintiff from assault outside its establishment in corridor of shopping mall); see also Ward v New York City Hous. Auth., 18 AD3d 391, 392 (1st Dept 2005) (landlord had no duty to protect tenants or others from criminal activity on public walkways outside building).
However, "[w]henever the general public is invited into stores, office buildings and other places of public assembly, the owner['s] . . . duty of providing the public with reasonably safe premises . . . [includes providing] a safe means of ingress and egress." Gallagher v St. Raymond's Roman Catholic Church, 21 NY2d 554, 557 (1968); see Peralta, 100 NY2d at143. The duty to provide a safe means of ingress and egress may, in some circumstances, extend outside a defendant's premises. Courts have found, for instance, a duty to maintain a safe means of entering and exiting premises to extend to outside staircases, temporary walkways set up outside a store's entrance, sidewalks near store entrances, plazas outside building entrances, and, in the case of subways and other common carriers, stairways or passageways used "primarily" to provide access to and from the subway. See e.g. Gallagher, 21 NY2d at 557 (church, as public building, had duty to have light on exterior stairs of the building at all times when it is open to the public); Walsh v Super Value, Inc., 76 AD3d 371 (2d Dept 2010) (ingress and egress included curb directly outside convenience store at gas station); Knapp v Golub, 72 AD3d 1260 (3d Dept 2010) (duty where slip and fall occurred when plaintiff was exiting supermarket on temporary asphalt walkway being used during renovations); Backiel v Citibank, N.A., 299 AD2d 504 (2d Dept 2004) (plaza walkway in front of building lobby exit); see also Bingham v New York City Tr. Auth., 8 NY3d 176 (2007) (common carrier duty to maintain a safe means of ingress and egress for passengers may extend to stairway or approach used "primarily" as means of access to transportation vehicle); Haberlin v New York City Tr. Auth., 228 AD2d 383 (1st Dept 1996) (transit authority denied summary judgment where plaintiff slipped on entryway to subway used almost exclusively by subway riders and maintained by transit authority); but see Peralta, 100 NY2d at 143-145 (no general duty to illuminate parking lot behind defendant's building); Giglio v Saratoga Care, Inc., 117 AD3d 1143, 1144 (3d Dept 2014) ("the duty to provide a safe means of ingress and egress to visitors to property does not extend to . . . pavement on property owned by another located across the street from defendants' property"); Castracane v Knights of [*7]Columbus, 190 AD2d 707 (2d Dept 1993) (carnival operator had no duty of care to carnival patrons who used adjacent parking lot owned by town).
Plaintiffs argue that Costco's duty to provide a safe means of ingress and egress extended to the area where Plaintiff's injury occurred, and Costco breached that duty because it had notice that there were objects being thrown from higher levels and failed to warn its customers as they exited the store that there were potential dangers. In support of their argument, plaintiffs rely on evidence submitted on a prior motion, including affidavits of two witnesses to the incident, who attest that a Costco employee told them that she had seen or heard that children were throwing slurpees over the railing earlier in the day and she had complained to Target. See Affidavit of Susan Mahoney, Ex. I to Rubino Aff.; Affidavit of Gaurav Patel, Ex. J to Rubino Aff. As previously found by this court, the Costco employee's hearsay account of a prior incident on the same day, provided in the witness affidavits, even assuming the account is admissible, shows only that the Costco employee properly responded and took precautionary measures by notifying security personnel and by sending a Costco security guard to investigate. See Hedges, 43 Misc 3d at 285-286. Evidence that Costco employees on two occasions in March and June 2011 made complaints to Planned Security also shows only that it responded appropriately.
Notably, plaintiffs provide no affidavit or testimony of the Costco employee who reportedly told the witnesses what had happened, and no affidavit or testimony of any Costco employee with personal knowledge of complaints made to or by Costco. Plaintiffs also apparently waived depositions of Costco and sought no further discovery from Costco as to the employee's account on the day of the incident, or how she or other Costco employees responded.
Plaintiffs claim that other evidence, including security logs indicating reports of two prior incidents, in March and June 2011, of kids throwing "'rocks' off gallery/garage levels," and "kids throwing garbage and playing in the escalators" (See Security Logs, Ex. K to Rubino Aff.), shows that Costco was aware of prior instances of objects being thrown from the upper levels of the shopping center, including on the day of the incident. Based on this knowledge, plaintiffs argue, Costco should have taken measures to protect customers, such as posting signs that warned people in the area where the objects had been thrown, or verbally warning shoppers of the danger. Plaintiffs assert that the evidence raises issues of fact as to whether Costco was negligent in failing to warn or protect customers from a known danger.
Costco, however, has demonstrated that the area where the incident occurred, an area about fifty feet from its entrance and across a roadway near the parking garage, was a common area of the shopping center and not in Costco's control or necessary for entering or exiting its premises. In opposition, plaintiffs' evidence fails to raise a triable issue of fact as to whether the common area of the shopping center where Plaintiff was injured was necessary for or primarily used as access to Costco's store.
The court therefore finds that Costco did not assume a duty to prevent or protect its customers after they left the store from criminal conduct in the common area controlled by Tiago, and consequently had no separate duty to make an announcement or post signs in its store or otherwise warn customers of a potential danger from falling objects in the common areas, even if it had knowledge of prior incidents of falling objects. See Signorile v Lefrak-SBN Assocs., 216 AD2d 133 (1st Dept 1995). Additionally, as noted by Costco, there is evidence that a protective overhang extended across the front of the Costco store in the area of ingress and egress. See [*8]Photos, Ex. H to Rubino Aff.
Bob's also moves to dismiss the complaint against it on the grounds that it owed no duty to plaintiffs, as it did not own, lease or control the area where the boys threw the cart, did not own or have responsibility for the cart, which undisputedly belonged to Target, and had no duty to supervise the boys after they left the store. Bob's argues that its duty to keep its premises reasonably safe and protect customers from foreseeable harm did not extend to the common area outside its store, and also argues that there is no evidence that the boys were misbehaving in the store and were thrown out, even if they did come into the store for free food being offered.
Plaintiffs assert that their claims against Bob's are not based on negligent maintenance of shopping carts or of the common areas outside its leased premises, but are premised on negligent supervision of the store's minor invitees, that is, children, including the minor defendants, who may have frequented the store because it offered free candy and soda. Plaintiffs submit affidavits from a current and a former Bob's employee, and a superintendent of a neighboring building, stating that Bob's, for two years, had been attracting children into its store by offering free food and drinks, and that the children often became disruptive and were expelled from the store. See Affidavits of Nelson Ramirez, Felix Robles, Ricardo Rodriguez, Exs. J, K, M to Rubino Aff. in Opp. to Bob's Motion (Rubino Aff. to Bob's). Based on these affidavits, plaintiffs argue that Bob's breached a duty to prevent reasonable foreseeable harm resulting from expelling the disruptive children into the shopping center without notifying security.
As a business proprietor in possession of a premises has a "'duty to take minimal security precautions against foreseeable criminal activity, including assaults upon individuals on the premises'" (Gerbino v Tinseltown USA, 13 AD3d 1068, 1071 [4th Dept 2004]), it accordingly has a duty to control the "reckless" or "unruly" conduct of persons on its premises when the business owner is aware of the conduct and the conduct could have been "mitigated or prevented through adequate supervision." Nunez v Recreation Rooms & Settlement, 229 AD2d 359, 360 (1st Dept 1996); see Banayan v F.W. Woolworth Co., 211 AD2d 591, 592 (1st Dept 1995). Courts addressing that duty generally have found that it exists with respect to conduct occurring on a defendant's premises which results in harm on its premises. See e.g. Mirand v City of New York, 84 NY2d 44 (1994) (school had duty to supervise students where attack on students by other students occurred at school); Nicholson v Board of Educ., 36 NY2d 798 (1975) (defendant had duty to supervise schoolyard being used as playground where firecracker thrown injuring plaintiff); Elkady v Very, Ltd., 8 AD3d 197 (1st Dept 2004) (assault on one bar patron by another at bar); Phelps v Boy Scouts of America, 305 AD2d 335 (1st Dept 2003) (duty to supervise campers at boy scout camp who assaulted plaintiff at camp); Rivera v 21st Century Restaurant, 199 AD2d 14 (1st Dept 1993) (assault on plaintiff at defendant's restaurant).
In some cases, courts also have found a duty and imposed liability on a property owner where the conduct of persons on its premises resulted in injuries to individuals on adjacent property. See Zane v Corbett, 82 AD3d 1603, 1607 (4th Dept 2011) (question whether breach of duty for failing to take steps "to prevent the repeated throwing of rocks, bricks and other objects from their playground into the plaintiff's backyard"); see also Davis v South Nassau Communities Hosp., 26 NY3d 563, 596 (2015) (due to special physician-patient relationship, hospital had duty to third persons to warn patient that medication impaired her ability to drive); [*9]Aquino v Higgins, 15 NY3d 903 (2010) (issue of liability based on duty to supervise not as landowners, but question was whether homeowners/parents adequately supervised minor guests who became intoxicated, in particular whether they properly supervised their departure from the premises); but see Martin v Stallman, 18 NY3d 905 (2012) (social hosts owe no duty to protect third persons from a guest who becomes intoxicated on and then drives from a premises controlled by the hosts).
In this case, as distinguished from the above cases, there are no claims that conduct of the minor defendants on Bob's premises resulted in injury on its premises or on adjacent premises. It is undisputed that shortly before the minor defendants threw the shopping cart over the fourth floor railing, they were in Bob's store; and there is some evidence that they were drawn there by the free food offered by Bob's and were thrown out of the store for unruly behavior. There also is some evidence that it was not uncommon for children to go to Bob's store, become disruptive, and be expelled into the mall, and that complaints were made to Bob's. There is, however, no evidence that Bob's negligently supervised the minor defendants or other children while they were in the store, and no legal authority to support finding that Bob's had a duty to supervise the boys after they left the premises or to notify security about the boys once they left the store. Finding no basis to conclude that Bob's had a duty to plaintiffs to prevent injury resulting from acts of the minor defendants occurring outside its premises, the issue of the foreseeability of injury resulting from expelling the boys into the mall need not be reached. See Martino, 18 NY3d at 908.
The Tiago Defendants
The Tiago defendants move to dismiss the complaint and all cross claims as against them, and plaintiffs cross-move against the Tiago defendants for partial summary judgment as to negligence. The Tiago defendants move to dismiss the complaint on the grounds that plaintiff's injuries were caused by the intervening actions of Rosario and Hernandez, and not by any negligence on the part of the Tiago defendants. While acknowledging their obligation as owner and operator of East River Plaza to take reasonable precautions to protect the public from foreseeable harm, including criminal acts of third parties on the premises, they contend that they had no duty to protect visitors from the unforeseeable and unexpected criminal acts of the boys. The Tiago defendants contend that no similar incident had happened before at the shopping center. They also contend that surveillance videotapes show that the events leading up to the incident occurred very quickly, and the boys' actions were spontaneous and unpreventable, and constitute an intervening act severing any causal link between plaintiffs' injuries and the Tiago defendants' alleged negligence.
In support of their argument, the Tiago defendants submit the affidavit of a forensic-behavioral scientist, who opined that throwing the cart over the railing was an impulsive, spontaneous, high-risk act for Rosario and Hernandez, and, based on his review of the surveillance videos, the boys could not have been deterred. See Memorandum of Law in Support of Tiago Defendants' Motion (Tiago Memo), at 11; Smerick Aff., Ex. R. to Burke Aff. in Support of Tiago's Motion (Burke Aff.). The Tiago defendants also argue that they satisfied their duty to take reasonable precautions to protect people and provide adequate security by retaining Planned Security to provide security services at the shopping center; and they submit an affidavit of a security expert who concluded Planned Security's policies and procedures at the shopping center [*10]met security industry and shopping center industry best practices and guidelines and complied with all local and state regulations. See Tiago Memo, at 10; Hudak Aff, Ex. Q. to Burke Aff. Notably however, the security expert did not address whether or how these policies and procedures were ever implemented. See Feb. Tr. at 27.[FN2]
In opposition, plaintiffs submit witness affidavits and daily log reports maintained by Planned Security showing that there were at least seven reported incidents between March and October 2011 involving various objects, such as rocks, candy, cans and garbage being thrown off the elevated walkways of the shopping center. As ERP's employee Lorraine Grier testified, the log entries of reported incidents, by themselves, provided notice to ERP and Tiago of prior incidents, as the logs should have been reviewed by ERP. Grier Dep., Ex. J to Burke Aff., at 269-272. Defendants produced no log reports for the period prior to March 2011, and log reports are missing for numerous days during the period from March through October 2011, including all of September, the week of October 14-20, and October 29, 2011 (the day before the incident). The absence of log reports for a substantial portion of relevant time, even without determining whether an adverse inference is warranted, leaves an open question as to the completeness of the records of reported incidents.
To establish foreseeability, it is not necessary to show that the prior activity was the same type of criminal conduct to which plaintiff was subjected or that it occurred at the exact location where plaintiff was harmed. Jacqueline S., 81 NY2d at 294. Owners have a duty to take protective measures when they know or have "reason to know from past experience 'that there is a likelihood of conduct on the part of third persons . . . which is likely to endanger the safety of the visitor.'" Nallan v Helmsley-Spear, Inc., 50 NY2d 507, 519 (1980) (citation omitted); see Jacqueline S., 81 NY2d at 294. Such knowledge obligates landowners to "'take precautions . . . and to provide a reasonably sufficient number of servants to afford a reasonable protection.'" Id.; cf. Leyva v Riverbay, 206 AD2d, 150, 152-153 (plaintiff shot on outer walkway of large housing complex, an area with no history of prior criminal activity to justify greater security measures).
The Tiago defendants have not demonstrated that as a matter of law the activities leading to plaintiffs' injuries were not foreseeable. Evidence of notice of seven incidents in six months involving disorderly youths throwing objects, and the affidavit of a security expert identifying additional security measures which could have been taken (see Decker Aff., Ex. A to Gaier Aff./Tiago), is sufficient to raise questions of fact as to whether the incident here was foreseeable, whether the Tiago defendants took reasonable or adequate steps to minimize a foreseeable danger, and whether such negligence was a proximate cause of plaintiff's injuries. Even if the prior incidents involved, for the most part, smaller objects, and notwithstanding that the Tiago defendants dispute that such objects could cause harm (see Transcript of Oral Argument, dated March 20, 2017 [Mar. Tr.], at 30; May Tr. at 4- 6), such incidents provided [*11]notice to the Tiago defendants that similar conduct could result in injury to others. Evidence also shows that they had notice that a shopping cart previously was thrown down an escalator. See Feb. Tr. at 49-50; Mar. Tr. at 19.
As to whether the boys' conduct was an intervening, superceding act severing any causal connection between defendants' negligence and plaintiffs' injuries, where, as here, "the risk of the intervening act occurring is the very same risk which [may] render the actor negligent," the intervening act does not relieve the actor of responsibility. Derderian, 51 NY2d at 316. Nor does the retention of Planned Security by the Tiago defendants shift their obligation to keep the shopping center reasonably safe, as there is no claim that Planned Security completely displaced Tiago's obligation to provide security. Among other things, the Tiago defendants determined the number of security guards to be employed at the shopping center, whether that number needed to be increased, and where the security guards were placed.
For the above reasons, the Tiago defendants' motion for summary judgment dismissing the complaint and all cross claims against it is denied. Similarly, because issues of fact remain as to the Tiago defendants' negligence, plaintiff's cross motion also is denied.
Planned Security moves to dismiss the complaint as against it on the grounds that it owed plaintiffs no duty of care under its security services contract with ERP, and that it otherwise met its obligations under the Agreement.[FN3] Plaintiffs were not, Planned Security asserts, third-party beneficiaries of the Agreement, as its duty under the Agreement was only to its client, ERP, not to the general public. Planned Security also claims that its security guards were obligated only to "observe and report" to ERP unusual or hazardous activity at the shopping center, and had no duty to prevent injuries. It further asserts that, under the Agreement, the number and placement of security guards were determined by ERP, not Planned Security, and it could not hire additional security guards without approval from ERP. See Feb. Tr., at 21-22, 23-24. In opposition and in support of their cross motion, plaintiffs argue that the Agreement identifies them as intended third-party beneficiaries of the contract, to which Planned Security owed a duty of care.
"[T]he existence and scope of a duty is a question of law requiring courts to balance sometimes competing public policy considerations. . . . [A] contractual obligation, standing alone, will generally not give rise to tort liability in favor of a third party." Espinal v Melville Snow Contrs., 98 NY2d 136, 138 (2002), citing Palka, 83 NY2d at 585-586; Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220, 226-227 (1990). However, "an injured [*12]plaintiff may recover as a third-party beneficiary of a security contract when a defendant security company fails to perform a duty imposed by contract when it appears that the parties to the contract intended to confer a direct benefit on the alleged third-party beneficiary to protect him [or her] from physical injury." Kelly v Norgate Bus. Assoc., 25 Misc 3d 1203(A), 899 NYS2d 60, 2009 NY Slip Op 51961(U) (Sup Ct, Bronx County 2009) , citing Kotchina v Luna Park Hous. Corp., 27 AD3d 696 (2d Dept. 2006).
"'Before an injured party may recover as a third-party beneficiary for failure to perform a duty imposed by contract, it must clearly appear from the provisions of the contract that the parties thereto intended to confer a direct benefit on the alleged third-party beneficiary.'" Id. at 697, quoting Bernal v Pinkerton's, Inc., 52 AD2d 760 (1st Dept 1976), affd 41 NY2d 938 (1977); see Brooks v Westfield, 2011 NY Misc LEXIS 1830, 2011 NY Slip Op 31025(U) (Sup Ct, Nassau County 2011) (where security company contracted to provide security to mall's customers and visitors, plaintiff visitor may be intended third-party beneficiary); see also Kotchina, 27 AD3d at 697 (obligations of security company hired to provide "security services for the building" not limited to protecting property but included duty to provide security for tenants of the premises) ; Kelly, 25 Misc 3d 1203(A) (finding agreement to "protect lives and properties" and written instructions that "safety of this property and the tenants depends on you" may include plaintiff visitor to building) ; compare Bernal, 52 AD2d at 761 (employee of Company not intended beneficiary of security contract which provided that security company hired to protect "Company's facilities and buildings"); Rahim v Sottile Sec. Co., 32 AD3d 77, 79 (1st Dept 2006) (store employee assaulted in store not intended third-party beneficiary of owners' contract with security company which expressly stated it provided no benefits to third parties); Bradley v HWA 1290 III LLC, 2017 NY Misc LEXIS 1109, 2017 NY Slip Op 30596(U) (Sup Ct, NY County 2017) (contract expressly excludes non parties as third-party beneficiaries and plaintiffs claimed no other basis to find a duty).
In certain circumstances, even when a plaintiff is not an intended third-party beneficiary of a contract, "parties outside a contract are permitted to sue for tort damages arising out of negligently performed or omitted contractual duties." Palka, 83 NY2d at 586; see Landon v Kroll Lab. Specialists, Inc., 22 NY3d 1, 6 (2013). In Espinal v Melville Snow Contrs. (98 NY2d 136 ), the Court of Appeals, noting that "the 'policy-laden nature of the existence and scope of a duty generally precludes any bright-line rules," held that "a party who enters into a contract to render services may be said to have assumed a duty of care — and thus be potentially liable in tort — to third persons: (1) where the contracting party, in failing to exercise reasonable care in the performance of his duties, 'launches a force or instrument of harm'; (2) where the plaintiff detrimentally relies on the continued performance of the contracting party's duties and (3) where the contracting party has entirely displaced the other party's duty to maintain the premises safely." Id. at 139, 140 (citations omitted); see Church v Callanan Indus., 99 NY2d 104, 111 (2002); American Cas. Co. of Reading, Pa. v Motivated Sec. Servs., Inc., 148 AD3d 521, 521 (1st Dept 2017). "This principle recognizes that the duty to avoid harm to others is distinct from the contractual duty of performance." Landon, 22 NY3d at 6.
In this case, the court finds that Plaintiff was an intended third-party beneficiary of the Agreement. Pursuant to the Agreement, Planned Security undertook a duty to "provide security services for maintaining the safety and protection of customers, invitees and employees of the [*13]Shopping Center while in or using the Common Areas." Agreement, Art. 2, § 1; see also Schedule A to Agreement. Its Standard Operating Procedures (SOP) similarly provided that "[t]hese policies and procedures have been designed by Planned Security Services, Inc. to ensure the protection of tenants, guests and property." SOP, Ex. K to Gaier Aff. in Opp. to Planned Security (Gaier Aff./PS), at 5. There is no provision in the Agreement limiting Planned Security's duties of protection to, for example, its client, or property, or otherwise excluding from its duties the personal protection of customers' safety. Compare Rahim., 32 AD3d 77 (express language excluded third-party beneficiaries). As the Court finds that Planned Security had a duty to plaintiffs as third-party beneficiaries, plaintiffs are not "required to establish that the circumstances of this case fall within one of the exceptions set forth in Espinal." Jackson v Guardsmark, Inc., 97 AD3d 1409, 1409-1410 (4th Dept 2008); cf. American Cas. Co., 148 AD3d at 521 (where plaintiff neither a party to defendant's contract nor an intended third-party beneficiary, court looks to Espinal to determine whether defendant owed plaintiff a duty) ; Hill v Kerman Protection Sys., 2013 NY Misc LEXIS 5191, 2013 NY Slip Op 32859(U) (Sup Ct, NY County 2013) (same).
As to its alleged negligence, Planned Security claims that it properly performed its services as proscribed by the Agreement, and had no obligation to perform services not expressly identified in the Agreement. Planned Security argues that plaintiffs' claims against it must be dismissed because they rest on allegations that it failed to have enough security guards at the shopping center. According to Planned Security, it was not responsible for the number of security guards hired and could provide additional services, such as additional security guards, only at the request of ERP or Tiago. See Feb. Tr. at 21-22; Agreement, Art. 2, § 2. Planned Security also argues that its sole and "exclusive" obligation with respect to unusual or hazardous conditions in the common areas was to "observe and report," and it had no obligation to take any other action to prevent incidents. See Feb. Tr. at 37.
Contrary to Planned Security's argument, plaintiffs' claims are not limited to whether there was an adequate number of security guards. Plaintiffs allege that Planned Security and other defendants were negligent in failing, among other things, to "provide appropriate, adequate and sufficient security personal [sic]" and "to assign, instruct and/or direct security personal [sic] to patrol, guard, protect, watch and otherwise make secure the East River Plaza walkways." Complaint, ¶ 57; see also Supplemental Verified Bill of Particulars (to Planned Security), Ex. E to Burke Aff., ¶ 18.
Further, Planned Security has not shown that, as a matter of law, its obligation was nothing more than to "supply" the security guards for the "buyer" (see Feb. Tr. at 39-40); its "exclusive" responsibility with respect to hazardous or unusual situations was to observe and report (id. at 36-37, 46); or it was constrained by the Agreement from modifying its "level and nature of services" in response to the prior incidents, whether by adjusting the number of staff or frequency of patrols or otherwise increasing the visibility of the security guards. See id. at 21-24. The Agreement provides both that Planned Security shall perform its services "at such times and in such manner as [it] may determine" (Agreement, Art. 2, § 2), and that Planned Security will be "aware of criminal activity in the vicinity of the shopping center and that it will modify its level and nature of services consistent with the then prevailing criminal activity." Id.; see Feb. Tr. at 20. Planned Security was aware of prior incidents involving objects being thrown from the [*14]higher levels of the mall, and on the evidence presented, including the affidavit of plaintiff's expert (see Decker Aff., Ex. C to Gaier Aff./PS), issues of fact exist as to whether Planned Security took "reasonable care in the discharge of [its] duties" (Jackson v Guardsmark, Inc., 57 AD3d 1409, 1410 [4th Dept. 2008]) to maintain the safety and protection of customers. See Kelly, 25 Misc 3d 1203(A).
Indemnification claims and cross claims
Target and Costco move for summary judgment against the Tiago defendants for contractual indemnification and a defense, based on the terms of their leases with Tiago; and Target also seeks conditional common-law indemnification against the Tiago defendants and Planned Security. The indemnification provisions in the Costco and Target leases with Tiago are, it is undisputed, essentially identical (see May Tr. at 49; see Burke Aff. in Partial Opp. to Co-Defendants' Motions [Tiago Opp.], at 8), and provide, in pertinent part:"Tenant and Landlord agree to indemnify and hold each other harmless from and against any and all claims, damages or causes of action for damages brought on account of injury to any person . . . arising out of . . . the use, operation or maintenance of . . . the Premises by Tenant . . . or the use of the Common Areas by Tenant or by the use, operation or maintenance of the Shopping Center . . . by Landlord . . . except for matters arising from the negligence or willful misconduct of the party seeking indemnification."
Lease, Ex. R (DVD) to DeLuca Aff. in Support of Target's Motion, § 11.5.
Section 11.5 further states that "[n]otwithstanding any other provisions set forth herein, the parties hereby agree that in the event of any damage to a party, including all personal and property damages and losses to a party's employees or invitees, each party shall resort to any and all insurance coverage available prior to asserting any claim or demand against the other party."
The leases also provide that Target and Costco, as tenants, shall maintain insurance covering their leased premises (id., § 11.1[a]); and Tiago, as landlord, shall maintain commercial general liability insurance, covering the Shopping Center, including all Commons Areas and the parking garage, with minimum limits of $5 million, naming Target and Costco as additional insureds under the liability insurance policy. Id., § 11.2 (a).
Counsel for Target and Costco represented, at oral argument on the motions, that each of them received a letter from Tiago, which did not dispute Tiago's obligation to indemnify them, but advised them that their demands were premature. See May Tr. at 46. At oral argument, counsel for Tiago also did not dispute that, upon a finding that Target or Costco was not negligent, Tiago had a duty to indemnify each of them. Id. at 46-47. The Tiago defendants argue, however, that neither Target nor Costco is entitled to contractual indemnification "at this time," because the indemnification agreement between Tiago and lessees Target and Costco is mutual and reciprocal, and requires Tiago and Costco to exhaust their own insurance coverage before asserting a claim against Tiago. See Feb. Tr. at 35-36; Tiago Opp. at 8.
Since the negligence claims have been dismissed against Target and Costco, the lease's indemnification clause, coupled with the insurance procurement provision requiring Tiago to name Target and Costco as additional insureds, obligates Tiago to indemnify and defend Target and Costco. See Great Northern Ins. Co., 7 NY3d at 415; see also BP A.C. Corp. v One Beacon Ins. Group, 8 NY3d 708, 714-715 (2007) (additional insured entitled to same protection as [*15]named insured); Pecker Iron Works of NY v Traveler's Ins. Co., 99 NY2d 391, 393 (2003) (same). "As the parties thus allocated the risk of liability to others between themselves through insurance, indemnity is not prohibited." K.L.M.N.I., Inc. v 483 Broadway Realty Corp., 117 AD3d 654, 655 (1st Dept 2014). Pursuant to the insurance procurement provisions, Target and Costco are required to obtain insurance covering their leased premises and naming Tiago as an additional insured; but Tiago is required to obtain insurance for the shopping center, naming Target and Costco as additional insureds, entitling them to a defense. See Lease, §§ 11.1 (a), 11.2 (a). Although the Tiago defendants argue that triable issues of fact exist as to whether the insurance they obtained covered Target and Costco (see Burke Aff. in Partial Opp., at 17), their obligation to name them as additional insureds is undisputed.
The Tiago defendants' argument that Target and Costco cannot make a claim against Tiago until they have sought other insurance available to them, is misplaced. The clause on which the Tiago defendants rely, in support of their argument, applies "in the event of any damage to a party, including all personal and property damages and losses to a party's employees or invitees," and there is no evidence, or argument, that the claims in this case involve personal or property damage to Target or Costco.
In view of the above, a determination of Target's claim for common-law indemnification against the Tiago defendants is not necessary. See Nov. Tr. at 28. As to Target's claim for common-law indemnification against Planned Security, Target's entitlement to such indemnification will depend on whether and to what extent Planned Security is found to be negligent. Issues of fact exist as to Planned Security's alleged negligence, but Planned Security does not raise issues of fact as to whether, or even argue that, Target was negligent (see Nov. Tr. at 38-39), and Target therefore is entitled to conditional common-law indemnification against Planned Security. See Nov. Tr. at 20-21; Mattioli v Zuckerman, 292 AD2d 268, 268 (1st Dept 2002); Shah v 20 E. 64th St., LLC, 2017 NY Misc LEXIS 3690, *39-40, 2017 NY Slip Op 32028(U) (Sup Ct, NY County 2017).
As negligence claims against Target, Costco, and Bob's have been dismissed, any cross-claims against them for common-law indemnification are dismissed. To the extent that any cross-claims for contractual indemnification were asserted against Target, Costco, and Bob's, no evidence of such a contractual obligation has been presented.
The Tiago defendants argue that they are entitled to summary judgment on their cross claim against Planned Security for contractual indemnification and a defense pursuant to the Agreement, which provides:"To the fullest extent provided by law, Contractor [Planned Security] shall indemnify, defend, protect and hold harmless Owner [Tiago], Agent [ERP] and their respective general partners, limited partners, members, managers, shareholders, officers, directors, agents and employees . . . from and against any and all claims, costs, damages, liabilities, losses and expenses, including attorneys' fees, directly or indirectly arising out of or alleged to arise out of or resulting from the performance of the Services, or the failure to perform the Services, or the breach of this Agreement by Contractor."
Agreement, Ex. L to Burke Aff., Article 4, § 5.2.
Planned Security does not dispute that the Agreement requires it to indemnify and defend [*16]Tiago and ERP[FN4] for claims arising out of or allegedly arising out of Planned Security's performance of or failure to perform its services. See Feb. Tr. at 13. Nor does it dispute that the Agreement provides for indemnification when a claim arises out of its work, even if it has not been negligent. See Brown v Two Exch. Plaza Partners, 76 NY2d 172 (1990); Quinonez v Manhattan Ford, Lincoln-Mercury, Inc., 62 AD3d 495 (1st Dept 2009). Rather, Planned Security argues that the indemnification provision does not apply because plaintiffs' claims and allegations did not arise out of Planned Security's performance of its services as defined in the Agreement.
The Court of Appeals has interpreted "[t]he phrase 'arising out of' . . . to 'mean originating from, incident to, or having connection with.'" Worth Constr. Co., Inc. v Admiral Ins. Co., 10 NY3d 411, 415 (2008), quoting Maroney v New York Cent. Mut. Fire Ins. Co., 5 NY3d 467, 472 (2005). As found above, plaintiffs have adequately alleged that their claims arise, at least in part, out of Planned Security's performance of its services, and issues of fact remain as to whether Planned Security was negligent in providing those services. As Planned Security does not otherwise offer opposition to the Tiago defendants' motions seeking contractual indemnification, this branch of the Tiago defendants' motion is granted as to Tiago and ERP.
The cross claims of the Tiago defendants and Planned Security against each other for common-law indemnification are dismissed, as neither has established on these motions that it is free of negligence.
Accordingly, the motions are granted in part and denied in part and it is
ORDERED that defendant Target's motion for summary judgment (seq. no. 014) dismissing the complaint and all cross claims against it is denied as moot; and it is further
ORDERED that Target's motion for summary judgment on its cross claim against the Tiago defendants for contractual indemnification and a defense is granted to the extent that Target is entitled to indemnification for costs incurred in the defense of the main action, including reasonable attorneys' fees, costs, and disbursements; and it is further
ORDERED that Target's motion for summary judgment on its cross claim against Planned Security for common-law indemnification is conditionally granted; and it is further
ORDERED that the Tiago defendants' motion for summary judgment (seq. no. 015) dismissing the complaint and all cross claims against them, and plaintiffs' cross motion against the Tiago defendants for partial summary judgment, are denied; and it is further
ORDERED that the Tiago defendants' motion for summary judgment on its cross claim against Planned Security for contractual indemnification is granted as to Tiago and ERP to the extent that Tiago and ERP are entitled to indemnification for costs incurred in the defense of the main action, including reasonable attorneys' fees, costs, and disbursements; and it is further
ORDERED that defendant Costco's motion for summary judgment (seq. no. 016) [*17]dismissing the complaint and all cross claims as against it is granted; and it is further
ORDERED that Costco's motion for summary judgment on its cross claim against the Tiago defendants for contractual indemnification is granted to the extent that Costco is entitled to indemnification for costs incurred in the defense of the main action, including reasonable attorneys' fees, costs, and disbursements; and it is further
ORDERED that defendant Planned Security's motion for summary judgment (seq. no. 017) dismissing the complaint and all cross claims against it and for summary judgment on its cross claims for indemnification is denied; and it is further
ORDERED that plaintiffs' cross motion for partial summary judgment against Planned Security is granted to the extent of finding that Planned Security owed a duty of care to plaintiffs; and it is further
ORDERED that defendant Bob's motion for summary judgment (seq. no. 018) dismissing the complaint and all cross claims against it is granted; and it is further
ORDERED that the remaining claims are severed and shall continue.
Dated: January 17, 2018
HON. CARMEN ST. GEORGE, J.S.C. Footnotes
Footnote 1:All parties agree that the surveillance videos submitted on the motions are authenticated and admissible (see Feb. Tr. at 6), and the video showing events leading up to the incident "speaks for itself." See Transcript of Oral Argument, dated Nov. 1, 2016 (Nov. Tr.), at 30.
Footnote 2:The Tiago defendants also argue that, to the extent that plaintiffs claim that the incident was caused by negligent design of the railing over which the shopping cart was thrown, the walkways and railings met all industry standards and building code requirements, and submit an architect's affidavit in support. At oral argument, plaintiffs' counsel confirmed that plaintiffs are not claiming that there was any violation of the building code or any other applicable statutes or regulations. See Feb. Tr. at 17.
Footnote 3:Plaintiffs' argument that Planned Security's motion should be denied because the notice of motion was procedurally improper is unavailing. Although Planned Security identifies its motion to dismiss as being made pursuant to CPLR 3211, without specifying a specific subsection, the papers submitted by Planned Security make clear that it is seeking summary judgment. Under such circumstances, and as plaintiffs had a full opportunity to respond to the issues raised and have not been prejudiced by the omission of a specific demand, "this Court will not elevate form over substance" (Ocwen Loan Servicing, LLC v Ohio Pub. Empls. Retirement Sys., 2014 NY Misc LEXIS 831, 2014 NY Slip Op 30469[U] [Sup Ct, NY County 2014] [citations omitted]), and considers the motion. See Nehmadi v Davis, 95 AD3d 1181, 1184 (2d Dept 2012); HCE Assocs. v 3000 Watermill Lane Realty Corp., 173 AD2d 774, 774-775 (2d Dept 1991).
Footnote 4:While factual issues have not been eliminated as to whether defendants Blumenfeld Development Group, Ltd, Forest City Enterprises, Inc., and Forest City Ratner Companies are covered, as entities with "an ownership interest" in Tiago, by the Agreement's indemnification provision, the parties appear to acknowledge that, practically speaking, its applicability to them need not be decided because all the Tiago defendants are represented by the same counsel. See Feb. Tr. at 3, 9-12; Mar. Tr. at 14-16.