Monaghan v. SZS 33 Associates, L.P.

73 F.3d 1276
CourtCourt of Appeals for the Second Circuit
DecidedJanuary 12, 1996
DocketNos. 359, 504, Dockets 95-7277, 95-7301
StatusPublished
Cited by10 cases

This text of 73 F.3d 1276 (Monaghan v. SZS 33 Associates, L.P.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Monaghan v. SZS 33 Associates, L.P., 73 F.3d 1276 (2d Cir. 1996).

Opinion

PARKER, Circuit Judge:

At 7:15 p.m. on March 23, 1987, William Monaghan was assaulted and shot in the head during an apparent attempted robbery by three men. The assault, which resulted in severe brain damage, occurred as he was approaching or descending a staircase leading from the vestibule of a commercial building on 33rd Street and Sixth Avenue in Manhattan to the subway below. His guardian ad litem, Eleanor Monaghan, filed this diversity action against the owner of the building, SZS 33 Associates, L.P. (“SZS”), alleging that it failed to reasonably ensure the safety of the premises. SZS, in turn, filed a third-party complaint for indemnification and contribution against the Port Authority of New York and New Jersey and its subsidiary, the Port Authority Trans-Hudson Company (collectively “PATH”), which owns the subway at the location of the shooting and holds an easement running through the SZS premises, including the stairway leading to the station.

Before us are appeals from two judgments entered in the United States District Court for the Southern District of New York (Robert W. Sweet, Judge). First, SZS appeals [1279]*1279from a February 23, 1995 judgment enforcing a settlement between SZS and plaintiff and awarding plaintiff $7.5 million in damages from SZS. SZS primarily argues that there was no final settlement among the parties. Second, SZS appeals from a judgment entered on March 8, 1995 after trial in the third-party action, granting SZS judgment over against PATH in the amount of $5,375,000 on an indemnity theory. SZS claims that if there is a settlement it is entitled to indemnification as to the entire $7.5 million, plus its defense costs. PATH cross-appeals from the same judgment, contending that it should not be required to indemnify SZS at all.

We affirm both judgments.

BACKGROUND

In a 1935 agreement between the predecessors of SZS and PATH (respectively, Gimbel Brothers, Inc. and the Hudson Manhattan Railroad), Gimbel granted an easement to the Railroad that includes the stairway where the assault occurred, referred to as Stairway No. 1 in the agreement. In Article Sixth (a) of the agreement, the Railroad agreed

at its own cost and expense to maintain ... in good condition and repair, and to properly light, that portion of Stairway No. 1 from the point of connection thereof with the new concourse of the Railroad Company up to the point of connection thereof with the Lobby or Vestibule Entrance within the Gimbel Building at the street level on Sixth Avenue, including the landing thereon ..., to keep said Approaches free from obstructions and in a clean, dry, neat, safe and suitable condition for the use of passengers and intending passengers ..., and to take every reasonable precaution to prevent nuisances, disorders and breaches of the peace therein so that persons using said Approaches may pass through the same freely and safely, without annoyance, interference or molestation. ...

(Emphasis added.) Article Sixth (b) (the stairway-indemnity clause) provides that the Railroad agreed “to be responsible for all accidents” that occur in the area described above and

at all times to exonerate, indemnify and save harmless ... Gimbel ... from and against any and all loss, cost, expense, damage and liability, or suits or claims therefor, arising out of or in connection with any such accident or accidents, excepting ... accidents resulting from or on account of negligence of any employee of ... Gimbel_

(Emphasis added.)

An additional section (undesignated by letter or number) of Article Sixth (the vestibule-indemnity clause) provides:

The Railroad Company further agrees that ... during such hours when business shall not be conducted within the Gimbel Building, it will ... properly light, clean and care for the lobbies or Vestibule Entrances within the Gimbel Building, and the entrances thereto on the street level, connecting with Stairways Nos. 1 and 3, respectively, will be responsible for all accidents to persons and/or property, howsoever suffered or incurred, within either of said lobbies or Vestibule Entrances, or entrances thereto, during such hours, and at all times will exonerate, indemnify and save harmless ... Gimbel ... from and against any and all loss, cost, expense, damage and liability, or suits or claims therefor, arising out of or in connection with any such accident or accidents....

(Emphasis added.) This last provision, pertaining to hours when Gimbel’s was not conducting business, does not contain the limiting language “excepting ... accidents resulting from or on account of negligence of any employee of ... Gimbel.”

At the time of the assault, March 1987, Gimbel’s was out of business and the old Gimbel’s store was undergoing demolition. SZS had taken certain measures to seal off or guard the entrances into the store while allowing continued use of the PATH stairway, and to patrol the premises.

Plaintiff commenced this action against SZS in 1989. The district court initially granted summary judgment to SZS on the grounds that SZS owed no duty to plaintiff [1280]*1280as to safety on the staircase and that the danger of criminal assault in the vestibule was not foreseeable. Monaghan v. SZS 33 Assocs., 760 F.Supp. 355, 360-62 (S.D.N.Y.1991). That judgment was affirmed in this Court by summary order. Monaghan v. SZS 33 Assocs., 953 F.2d 635 (2d Cir.1991). In 1991, plaintiff filed a companion suit against the contractor, who provided security for SZS during the demolition, McLane Security, Inc., and the construction manager, Tishman Construction Corporation of New York. During discovery in the companion case, plaintiff obtained certain documents not previously provided during discovery in this litigation, which contradicted the position SZS had previously taken (for example, that SZS did not provide security in the area of the assault and that it had no documents relating to security). One of the documents, a memorandum entitled “General Security Procedures,” provided that McLane’s “duties will encompass prevention of unauthorized access to the building equipment and facilities,” including entrance vestibules. On plaintiffs motion under Federal Rule of Civil Procedure 60(b)(3), the district court then vacated the judgment previously entered in favor of SZS and reinstated this action, noting that SZS “deliberately avoided turning over” the General Security Procedures memorandum and that “[t]he documents were arguably within the scope of the [document] request and definitely relevant to the subject matter involved.” Monaghan v. SZS 33 Assocs., No. 89 Civ. 4900 (RWS), 1992 WL 135821, at *4 (S.D.N.Y. June 1, 1992).

After further discovery in which SZS produced copies of invoices from McLane and a November 1986 letter from McLane containing the latter’s recommendations for a security force to patrol the site, plaintiff moved for sanctions against SZS under Federal Rule of Civil Procedure 37(b), claiming the invoices, letter and certain other items should have been disclosed in response to the earlier discovery demand.

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