Fallone v. Misericordia Hospital

23 A.D.2d 222, 259 N.Y.S.2d 947, 1965 N.Y. App. Div. LEXIS 4150
CourtAppellate Division of the Supreme Court of the State of New York
DecidedMay 18, 1965
StatusPublished
Cited by26 cases

This text of 23 A.D.2d 222 (Fallone v. Misericordia Hospital) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fallone v. Misericordia Hospital, 23 A.D.2d 222, 259 N.Y.S.2d 947, 1965 N.Y. App. Div. LEXIS 4150 (N.Y. Ct. App. 1965).

Opinion

Valente, J.

Defendant Industrial Engineering Co. (Industrial) appeals from a judgment in plaintiff’s favor entered upon a verdict of a jury. The question presented on this appeal is whether workmen’s compensation was plaintiff’s exclusive remedy which precluded recovery in this action.

Plaintiff was injured on May 2, 1957 when in the course of the construction of certain hospital buildings in Bronx County, a scaffold, on which plaintiff was working, collapsed.

On May 22, 1956 Vermilya-Brown Construction Co. (Vermilya) entered into a contract with the owners to construct the [224]*224hospital. On May 24, 1956, Vermilya and Industrial entered into a contract in which they agreed to perform the construction contract as joint venturers. That agreement was consented to by the owner of the property.

In summary, the testimony of plaintiff and his witnesses on the liability phase of his case was that plaintiff was a specialist in concrete work and was an employee of Vermilya; and that at the time of the accident, and for several days prior thereto, plaintiff was working under the direction of Industrial’s foreman. This proof presented an issue of negligence as to the supplying of an inadequate scaffold.

Appellant offered no testimony as to the accident but called the cost accountant of Vermilya as a witness. That witness testified that Vermilya and Industrial were jointly engaged in the construction of the buildings, and that there was no segregation in payrolls of Vermilya and Industrial. Tax withholding and social security records showed that plaintiff was receiving his salary from the joint venture.

The crux of the defense, as pleaded in appellant’s answer, was that Vermilya and appellant were both acting as general contractors on the construction job and that plaintiff was employed by the joint venture; that the joint venture had complied with the Workmen’s Compensation Law by providing a policy of workmen’s compensation insurance with an approved surety company; and that consequently workmen’s compensation benefits under that policy provided plaintiff’s sole remedy. (Workmen’s Compensation Law, §§ 10, 11, 29, 50.)

At the conclusion of the testimony, the Trial Judge dismissed the defense based on workmen’s compensation, holding that defendant had not sustained the burden of proving that plaintiff was an employee either of Industrial or of the joint venture.

We have concluded that the Trial Judge erred in dismissing the defense and that the judgment in plaintiff’s favor should be reversed and the complaint dismissed on the ground that workmen’s compensation was plaintiff’s exclusive remedy precluding recovery in this action.

Section 10 of the Workmen’s Compensation Law requires that every employer secure compensation for his employees to cover benefits for the disability or death of employees from injuries arising out of and in the course of their employment without regard to fault. Where an employer has obtained compensation insurance, section 11 of the same act provides that workmen’s compensation shall be the exclusive remedy of injured employees.

[225]*225An “Employer” is defined in subdivision 3 of section 2 of the Workmen’s Compensation Law as follows: “‘Employer’, except when otherwise expressly stated, means a person, partnership, association, corporation”. This definition does not specifically refer to a “ joint venture Plaintiff argues that the omission of the category of “ joint venture ” from the definition in subdivision 3 of section 2 was deliberate since a joint venture is not an entity. There is no basis to support a claim of deliberate omission. The contention that only “ entities ” are

described in the definition is untenable. An association is not an entity. In Williams v. Hartshorn (296 N. Y. 49, 51) it was held in a workmen’s compensation case that “ a partnership is not to be regarded as a separate entity distinct from the persons who compose it.”

A joint venture was defined in Forman v. Lumm (214 App. Div. 579, 583) as “an association of two or more persons to carry out a single business enterprise for profit, for which purpose they combine their property, money, effects, skill and knowledge ”. (For similar definitions and discussions of the nature of a joint venture, see 32 N. Y. Jur., Joint Adventures, §§ 1-5; Ann. 63 A.L.R. 909; 41 Cornell L. Q. 640; 18 Fordham L. Rev. 114.)

An examination of the agreement between Vermilya and Industrial discloses that the parties are referred to as “ Joint Venturers ” and that the agreement is limited to the project for the construction of the hospital. The respective interests of the parties in the net proceeds and in their obligations and liabilities are fixed at 75% for Vermilya and 25% for Industrial. Provision is made for the selection of specific designees of the joint venturers to make decisions in connection with the performance of the construction work. Costs of insurance and taxes on labor, among other things, are made part of the cost of construction.

Defendant offered to show that workmen’s compensation insurance was provided and procured by the joint venture pursuant to the agreement, but the trial court excluded such proof on the ground that the agreement spoke for itself. That was an erroneous ruling since the proffer was as to performance and not interpretation of the agreement. There is evidently no dispute that the parties to the agreement did procure workmen’s compensation insurance. The appeal has been argued on that basis.

The conclusion that the agreement between Industrial and Vermilya is unquestionably one of a joint venture to construct [226]*226the hospital buildings is irrefutable. It meets all the tests for such a relationship, i.e. an association of two or more persons to carry out a single enterprise for profit. (See Shove v. Siegbert, 239 App. Div. 334.) Being parties to a joint venture, the liability as to the parties to the agreement for torts is governed by the law applicable to partnerships. (Prosser, Torts [3d ed.], § 71, p. 489.) In Haxton & Son v. Rich (267 App. Div. 492, 495) the court said: “ Rules of law governing partnerships, if relevant, apply to a joint adventure ’ which in this State has been termed a ‘ limited copartnership ’ [citing cases] (See, also, 2 Rowley, Partnership [2d ed.], § 52.55 ; 30 Am. Jur., Joint Adventures, § 58.)

There is no authoritative decision in this State dealing with the precise question posed in the instant case; but holdings in other jurisdictions point to the proper determination. Whether the joint venture herein be treated as a separate entity (see Toenberg v. Harvey, 235 Minn. 61) or as a creation of a status or relationship between the parties (Johnston Grain Co. v. Self, 344 P. 2d 653 [Okla.]) plaintiff must be considered an employee of the joint venture. In Johnston Grain Co. v. Self, the court held that the employee of a joint venture was the employee of each of the joint adventurers so as to make insurance carriers who had insured each joint, adventurer for workmen’s compensation jointly and severally liable for a compensation award. (See, also, Breeze v. Herbert J. Elkins, Inc., 51 N. J. Super. 296; Industrial Comm. v. Lopez, 150 Col. 87.)

Thus, whether or not the joint venture be considered to fall within the scope of section 2, subd.

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23 A.D.2d 222, 259 N.Y.S.2d 947, 1965 N.Y. App. Div. LEXIS 4150, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fallone-v-misericordia-hospital-nyappdiv-1965.