Ned S. Church, an Infant, by
Wendy Smith, &c., et al.,
Appellants,
v.
Callanan Industries Inc.,
Defendant,
San Juan Construction and
Sales Company,
Respondent,
et al.,
Defendant.
(And a third-party action.)
2002 NY Int. 137
Plaintiff Ned Church, age nine, received catastrophic
spinal injuries December 26, 1992, when the driver of a
Volkswagen Jetta in which he was a rear seat occupant fell asleep
at the wheel. The vehicle veered off the southbound traffic
portion of the New York State Thruway near mile post marker
132.7, careened down a non-traversable embankment and crashed in
a V-shaped ditch at the bottom. The Thruway site where the
vehicle left the highway was within a 22-mile resurfacing and
Pursuant to its contract with the Thruway Authority, Callanan agreed, by a date certain, to "construct and complete in the most substantial and workmanlike manner, the construction, improvement or reconstruction of the project" identified in the project plans and specifications. The project specifications called for the removal of some 275 feet of existing guiderail in the vicinity of mile marker 132.7 and its replacement by a longer (312.5 feet) guiderail system. The contract documents also contemplated Callanan's use of subcontractors on the project.
In a related agreement, the Thruway Authority engaged the construction engineering firm of Clough, Harbour & Associates as project Engineer to inspect and supervise Callanan's compliance with the contract plans and specifications. Under the Thruway Authority's agreement with Callanan, the Engineer's recommendation was required before final acceptance of the contractor's work.
Callanan entered into a subcontract with defendant San
Juan Construction and Sales Company for the installation of the
guiderail system in question. The subcontract incorporated the
general contract by reference. It also stipulated that [a]ll
Suit was brought on behalf of the infant plaintiff against Callanan, San Juan and Clough Harbour. The gravamen of the action was both the negligent failure to complete the full 312.5 feet of new guiderailing called for by the Callanan general contract and the San Juan subcontract, and Clough Harbour's negligent inspection and approval of the installation despite such non-completion. Specifically, the complaint alleged that (1) San Juan installed only some 212 of the 312.5 feet of guiderailing called for by the contracts; (2) the missing portion of the guiderail installation included the place where the Jetta went out of control and left the highway; and (3) as a result of the negligent non-completion of the guiderail installation, the infant plaintiff incurred devastating injuries when the Jetta crashed at the bottom of the embankment.
After joinder of issue and discovery, Callanan and San
The case is before this Court as of right, pursuant to
The threshold and dispositive question on this appeal is whether San Juan owed the infant plaintiff a duty of care. The existence and scope of a duty of care is a question of law for the courts entailing the consideration of relevant policy factors (see Hamilton v Beretta U.S.A. Corp., , 96 NY2d 222, 232 [2001]). In this case, any duty San Juan had with respect to the installation of guiderailing at mile post marker 132.7 on the southbound Thruway arose exclusively out of San Juan's contractual undertakings set forth in its subcontract with Callanan. In other words, San Juan had no preexisting duty imposed by law to install guiderailing at that point on the Thruway.
Beginning with Chief Judge Cardozo's landmark decision
in H.R. Moch Co. v Rensselaer Water Co. (247 NY 160 [1928]), we
have consistently held that, ordinarily, breach of a contractual
obligation will not be sufficient in and of itself to impose tort
liability to non-contracting third parties upon the promisor (see
Eaves Brooks Costume Co. v Y.B.H. Realty Corp., , 76 NY2d 220, 226
[1990]). Rather, the injured party is relegated to contractual
remedies, if any. This reflects generally accepted legal
principles, largely derived from Moch. [I]f the alleged
As more extensively discussed in Espinal v Melville Snow Contrs., Inc. (98 2 136, 139-141 [2002]), our cases have nevertheless thus far identified three sets of circumstances, as exceptions to the general rule, in which a duty of care to non- contracting third parties may arise out of a contractual obligation or the performance thereof. In such cases, the promisor is subject to tort liability for failing to exercise due care in the execution of the contract. The first is where the promisor, while engaged affirmatively in discharging a contractual obligation, creates an unreasonable risk of harm to others, or increases that risk (see id. at 139, 141-142 ["a defendant who undertakes to render services and then negligently creates or exacerbates a dangerous condition may be liable for any resulting injury" (citing Moch, 247 NY at 167)]). Moch describes that conduct, subjecting the promisor to tort liability, as launch[ing] a force or instrument of harm (247 NY at 168; see Cubito v Kreisberg, , 51 NY2d 900 [1980], affirming for reasons stated in opn below 69 AD2d 738 1979]).
The second set of circumstances giving rise to a
promisor's tort liability is where the plaintiff has suffered
injury as a result of reasonable reliance upon the defendant's
continuing performance of a contractual obligation (see Espinal,
98 NY2d at 140 [where the plaintiff detrimentally relies on the
continued performance of the contracting party's duties]; see
also Prosser & Keeton,
Third, we have imposed tort liability upon a promisor where the contracting party has entirely displaced the other party's duty to maintain the premises safely (Espinal, 98 NY2d at 140 [citing Palka v Servicemaster Mgt. Servs. Corp., , 83 NY2d 579, 589 (1994)]). In contrast to the first exception, the promisor under such circumstances may indeed be liable for failing to make conditions safer for the injured party.
Plaintiff fails to qualify under any of the foregoing
exceptions. There is no evidence in the record that San Juan's
incomplete performance of its contractual duty to install 312.5
feet of guiderailing falls within the first exception -- i.e.,
that it created or increased the risk of the Jetta's divergence
from the roadway beyond the risk which existed even before San
Juan entered into any contractual undertaking. In this respect,
San Juan classically exemplifies the promisor described in Moch
Likewise, this case does not fall within the second exception. It is not (and cannot be) contended here that the tragic loss of control of the Jetta occurred because the driver detrimentally relie[d] on the continued performance of [San Juan's contractual] duties (Espinal, 98 NY2d at 140) when she failed to remain awake and alert at the wheel.
Nor can San Juan's liability be sustained under an
assumption of the Thruway Authority's safety duty theory under
Palka or Espinal, both of which are instructive while reaching
opposite results. They teach that tort liability for breach of
contract will not be imposed merely because there is some safety-
related aspect to the unfulfilled contractual obligation. If
liability invariably follows non-performance of some safety-
related aspect of a contract, the exception would swallow up the
general rule against recovery in tort based merely upon the
Palka illustrates the kind of additional factors which
may support recovery in tort upon the theory that the promisor
assumed the promisee's safety responsibilities. In Palka, the
plaintiff nurse-employee of a hospital was injured when a
defectively maintained fan fell on her while she was caring for a
patient. In holding the proof sufficient to impose liability
upon the maintenance company with whom the hospital had a service
contract, we relied upon the evidence that the contract was
comprehensive and exclusive (83 2 at 588) as to preventative
maintenance, inspection and repair, thus making the defendant
the sole privatized provider for a safe and clean hospital
premises (id. at 589). Moreover, we pointed out that, in
undertaking all aspects of safety inspection and repair at the
health facility, defendant 'does or ought to foresee the
likelihood of physical harm to third persons as a result of
reasonable reliance by the owner on [it] to discover or repair
dangerous conditions' (id. [quoting Prosser & Keeton,
Contrariwise, in Espinal, we declined to impose liability upon a snow removal contractor, absent evidence that he created or exacerbated a dangerous condition because, under the terms of the contract, the promisee effectively at all times retained its landowner's duty to inspect and safely maintain the premises (98 2 at 141).
This case falls comfortably within the Espinal precedential orbit.[2] Unlike the circumstances presented by Palka, San Juan did not comprehensively contract to assume all the Thruway Authority's safety-related obligations with respect to the guiderail system. Instead, the Thruway Authority retained a separate project engineer to provide inspection and supervision of all aspects of the project, including contract compliance with respect to the stipulated length of the guiderail system. These roles of the project engineer were specifically incorporated into both sets of the relevant contract documents, which required the engineer's approval of the work.
The San Juan contract can be contrasted with
Undisputably, under the contractual framework, San Juan
never assumed the Thruway Authority's common law tort duty to
oversee and insure the installation of the adequately safe length
of guiderailing in the vicinity of mile post marker 132.7 of the
southbound Thruway. Likewise, inspection responsibilities as to
the proper length of guiderail were never contractually shifted
to San Juan (see Prosser & Keeton,
For the foregoing reasons, we conclude that San Juan
Footnotes
1 During the pendency of the appeals, plaintiffs settled their suits against Callanan and Clough Harbour.
2 Contrary to plaintiffs' contention, Espinal and the cases
it discusses cannot be distinguished on the basis that the
contractual obligations in all of them were executory, rather
than executed, as in the instant case. The principles outlined
in Espinal equally apply to executed contracts, such as an
undertaking to repair a single device (see Prosser & Keeton,