Watral & Sons, Inc. v. OC Riverhead 58, LLC

34 A.D.3d 560, 824 N.Y.S.2d 392
CourtAppellate Division of the Supreme Court of the State of New York
DecidedNovember 14, 2006
StatusPublished
Cited by7 cases

This text of 34 A.D.3d 560 (Watral & Sons, Inc. v. OC Riverhead 58, LLC) 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
Watral & Sons, Inc. v. OC Riverhead 58, LLC, 34 A.D.3d 560, 824 N.Y.S.2d 392 (N.Y. Ct. App. 2006).

Opinions

In an action to foreclose a mechanic’s lien, the defendant OC Riverhead 58, LLC, appeals, as limited by its brief, from so much of a judgment of the Supreme Court, Suffolk County (Costello, J.), dated March 31, 2005, as, upon an agreed-upon statement of facts, is in favor of the plaintiff and against it in the principal sum of $82,401.

Ordered that the judgment is modified, on the facts, by deleting the provision thereof awarding the plaintiff damages in the principal sum of $82,401, and substituting therefor a provision awarding the plaintiff damages in the principal sum of $12,762; as so modified, the judgment is affirmed insofar as appealed from, without costs or disbursements.

[561]*561The defendant OC Riverhead 58, LLC (hereinafter the defendant), owns a parcel of property in Riverhead, located across from the Tánger Mall. On December 6, 1999 the defendant entered into an agreement with the plaintiff Watral & Sons, Inc., for the performance of excavation work in connection with a project to construct an Applebees Restaurant on the premises. The adjusted contract price for the plaintiffs work, including certain additions and credits reflected by change orders, was $167,401.

At issue on appeal is the scope and interpretation of two indemnification provisions set forth in the parties’ contract. The first provision, subparagraph 4.18.1 is essentially a statement of the plaintiffs common-law duty to indemnify the defendant owner for personal injury and property damage caused by the plaintiffs own negligence. To this end, subparagraph 4.18.1 states that “[t]o the fullest extent permitted by law, the Contractor shall indemnify and hold harmless the Owner . . . from and against all claims, damages, losses and expenses . . . arising out of resulting from the performance of the Work” provided that any such claim “is caused in whole or in part by any negligent act or omission of the Contractor.” Subparagraph 4.18.1 concludes by stating that this obligation to indemnify “shall not be construed to negate, abridge or otherwise reduce any other right or obligation of indemnity which would otherwise exist as to any party or person described in this Paragraph.”

The second indemnification provision in the parties’ contract is set forth in article 10 of the contract, entitled “Protection of Persons and Property.” Subparagraph 10.2.1 of this article begins by requiring the plaintiff contractor to “take all reasonable precautions” for the safety of employees and other persons at the work site, and to “provide all reasonable protection” to prevent damage, injury or loss to property. Pursuant to subparagraph 10.2.1, clauses 2 and 3, the property required to be protected from damage consists, inter alia, of materials, equipment, and “other property at the site or adjacent thereto, including trees, shrubs, lawns, walks, pavements, roadways, structures and utilities not designated for removal, relocation or replacement in the course of construction.” Subparagraph 10.2.5 of the contract then imposes a duty upon the plaintiff to “promptly remedy all damage or loss ... to any property referred to in Clauses 10.2.1.2 and 10.2.1.3 caused in whole or in part by the Contractor . . . and for which the Contractor is responsible under Clauses 10.2.1.2 and 10.2.1.3, except damage or loss attributable to the acts or omissions of the Owner, the [562]*562Architect, the Construction Manager or anyone directly or indirectly employed by any of them, or by anyone for whose acts any of them may be liable, and not attributable to the fault or negligence of the Contractor.” This provision then concludes by specifying that “the foregoing obligations of the Contractor are in addition to the Contractor’s obligations under Paragraph 4.18”.

According to an agreed-upon statement of facts, on August 3, 2000, one of the plaintiff’s employees was performing excavation work for the installation of a sewer line when his backhoe struck and damaged an underground power cable that supplied electricity to an adjacent property owned by Adchem Corporation. Prior to commencement of the excavation work, a project superintendent employed by the defendant’s construction manager had notified “New York One Call” that work was being performed at the site, and had called for marking of the electric line. However, it appears that after the marking was performed, an electrician relocated the cable because it was interfering with construction. When the area where the cable was struck was examined, it was also discovered that “excess cable, in the form of a loop, had been buried, at the time of the original cable installation.” It is not clear from the stipulated facts whether the excavator struck the cable because it had been relocated after marking of the electric line, or because the loop of excess cable protruded beyond the marked area. In any event, after this incident, the plaintiff agreed to pay $8,000 for the materials necessary to repair the cable, and the electrician who had relocated the cable agreed to supply his labor.

Two weeks later, on August 17, 2000, one of the plaintiffs employees was performing excavation work near the site where the cable had been damaged in order to adjust the height of the sewer. The project superintendent was present, and was supervising the height adjustment. During the course of this work, the ground adjacent to the excavation gave way, dragging the cable toward the excavation site. Although the excavator’s backhoe did not actually come in contact with the cable, the cable was once again damaged and electric service to Adchem’s property was disrupted.

During the spring and summer of 2000 the defendant paid the plaintiff a total of $85,000 for its work. However, the defendant withheld payment of the $82,401 balance due under the parties’ agreement, apparently because it was involved in a dispute with Adchem over damages caused by the disruption of electric service to its property. The defendant [563]*563subsequently resolved the dispute by paying Adchem a total of $69,639.

The plaintiff filed a mechanic’s lien against the property in January 2001 and thereafter commenced this action to foreclose the lien. After the parties submitted the matter to the Supreme Court on their agreed-upon statement of facts, the court found in favor of the plaintiff, concluding that subparagraphs 4.18.1 and 10.2.5 of the parties’ contract, read in pari materia, revealed an intent to require the plaintiff to answer only for its own negligent acts. The court further concluded, based upon the stipulated facts, that the plaintiff had not been negligent in striking the cable on August 3, 2000 or responsible for the additional damage caused when the ground adjacent to the excavation gave way on August 17, 2000. In support of its conclusion, the court pointed out that the cable had been relocated by others prior to the incident on August 3, 2000 and that the plaintiff had not been the only entity working at or near the location of the cable when the cave-in occurred on August 17, 2000. A judgment in favor of the plaintiff and against the defendant in the principal sum of $82,401 was thereafter entered, and this appeal ensued.

On appeal, the defendant contends that it is entitled to indemnification for the damage caused by the plaintiff’s work pursuant to subparagraph 10.2.5 of the contract, and that the Supreme Court erred in reading this provision in pari materia with subparagraph 4.18.1. We agree.

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Bluebook (online)
34 A.D.3d 560, 824 N.Y.S.2d 392, Counsel Stack Legal Research, https://law.counselstack.com/opinion/watral-sons-inc-v-oc-riverhead-58-llc-nyappdiv-2006.