Premises Pointers
Watch your step!

 

Volume I, No. 12

Tuesday, May 15, 2018

A Monthly Electronic Newsletter

 

As a public service, Hurwitz & Fine, P.C. is pleased to present this monthly newsletter providing summaries of and access to the latest premises liability decisions from the New York State and Federal courts. The primary purpose of this newsletter is to provide timely educational information and commentary for our clients and subscribers. In some jurisdictions, newsletters such as this may be considered Attorney Advertising.

 

If you know of others who may wish to subscribe to this free publication, or change your subscription status, please contact Jody E. Briandi at [email protected] or call 716-849-8900. All issues of Premises Pointers are listed on the firm website at www.hurwitzfine.com.


NEWSLETTER EDITOR
Jody E. Briandi
[email protected]

 

ASSOCIATE EDITOR

Todd C. Bushway

[email protected]

                                                                                                              

ASSISTANT EDITORS

V. Christopher Potenza

[email protected]

 

Tessa R. Scott

[email protected]

 

Anastasia M. McCarthy

[email protected]

 

James L. Maswick

[email protected]

 

Marc A. Schulz

[email protected]

 

WHAT PREMISES POINTERS COVERS

 

Retail, Restaurant and Hospitality Industry

Slip and Fall Accidents

Snow/Ice Claims and Storm in Progress

Inadequate/Negligent Security

Inadequate Maintenance

Negligent Repair

Defective and Dangerous Conditions

Elevator and Escalator Accidents

Swimming Pool and Recreational Accidents

Dog Bites/Animal Liability

Negligent Supervision

Assumption of Risk

Limited Services Contracts

Indemnification Agreements

Tavern Owner Liability and Dram Shop

Homeowner Liability

Toxic Exposures

Municipal Liability

 

NOTE FROM THE EDITOR

 

Welcome to our 12th edition of Premises Pointers!  We will begin Volume II next month.  We hope you are enjoying both the case summaries and commentaries from our Hurwitz & Fine attorneys.  Hard to believe it’s been almost one year since we launched this publication.   Speaking of time flying, and on a more personal note, both Todd Bushway and I are the parents of high school seniors who are graduating this week – my son on Thursday and Todd’s daughter this weekend.  They are both headed to college in the fall.  It’s truly amazing how time flies.  Our graduating seniors are members of the Gen Z generation, also known as I-Generation, I-Gen or Post-Millennials.  According to the research, Gen Z’s are less focused but better multi-taskers, more entrepreneurial, big on individuality, have high expectations, have been wired and connected practically since birth, have significant digital footprints and are more global.  In the workforce, they expect greater flexibility to work remotely, collaboratively and seamlessly across various devices and expect to have their input welcomed and respected.  Food for thought for Todd and I was we embark on the college years with our Gen Z kids.

 

As for this month’s edition, we have an interesting and varied collection of cases from our editors.  Here is the breakdown:  Todd’s selection covers the interplay between primary assumption of risk, GOL §5-326 and releases, Chris (our toxic tort guru) tackles hazardous chemicals, Tessa has a trivial defect update (among other things), Anastasia brings you the latest in the world of snow and ice and storm in progress (and also has a dramshop/liquor liability case to mix things up), our elevator expert Jamey explains res ipsa loquitor in the case of the “freefalling” elevator and Marc brings you the first case  first post- Forman v Henkin case (Court of Appeals social media case decided in February) and also two employer “alter ego” cases.

 

As always, please feel free to share this newsletter with friends and colleagues who would find it useful.  If you are interested in being added to our subscription list, just send me an e-mail at [email protected].  And if would like to be added to Coverage Pointers e-mail Dan Kohane at [email protected] and/or Labor Law Pointers e-mail David Adams at [email protected].  Please do not hesitate to reach out to me with questions or comments.  I would love to hear from you!

 

Jody

 

Hurwitz & Fine, P.C.

www.hurwitzfine.com

 

Buffalo
1300 Liberty Building, Buffalo, NY 14202

Phone: 716-849-8900, Fax: 716-855-0874

           

Long Island

535 Broad Hollow Rd., A-7, Melville, NY 11747
Phone: 631-465-0700, Fax: 631-465-0313

 

Albany

Corporate Woods, Albany, NY 12211
Phone: 518-786-1800, Fax: 518-786-1969

 

Lake Placid

2577 Main Street, Lake Placid, NY 12946
Phone: 518-523-2441, 518-523-2442

 

Additional Offices
Albion | Amherst | Niagara Falls | Palm Beach Gardens | Toronto

 

Hurwitz & Fine, P.C. is a full-service law firm providing legal services

throughout the State of New York

 

© Hurwitz & Fine, P.C. 2017 - All Rights Reserved
 

 

Retail, Restaurant and Hospitality Happenings Around

New York State and Beyond

By: Jody E. Briandi [email protected]

 

04/19/18          Firment v. Dick’s Sporting Goods, Inc.

Appellate Division, Third Department

Summary judgment denied to retailer even though retailer placed warning cones on the floor after it had been mopped warning shoppers the floor was wet

Plaintiff slipped and fell on the floor near the entrance of defendant’s store.  In moving for summary judgment, defendant established that 20 minutes before plaintiff’s fall the area was mopped due to dog feces being tracked into the store.  After mopping the area, the employee placed two yellow caution signs to warn shoppers, which plaintiff walked right by when she entered the store.  Several witnesses testified that the floor was extremely wet after the mopping was completed, which was also verified by surveillance video.  The Court determined that the extreme wet conditions raised a question of fact regarding whether the retailer maintained the store in a reasonably safe manner.  Since the defendant created the wet condition, notice was on the issue.  However, defendant argued that the placement of the warning cones satisfied their obligation to maintain the premises. The court disagreed and stated that the “presence of the warning signs does not prima facie establish entitlement to summary judgment as there is a question of fact as to the adequacy of the warning, particularly given the otherwise dry conditions outside, the placement and height of the signs and the heavy customer traffic where the signs were set.”

 

04/19/18          Charles v. Brookfield Properties

Appellate Division, First Department

Summary judgment denied to owner because restroom where plaintiff slipped on Monday morning was last cleaned on Friday night, hence leaving open the possibility that it was not kept clean over the weekend

Plaintiff slipped and fell in defendant’s public restroom and sued the owner and maintenance company.  While defendant submitted proof establishing that the restroom was routinely cleaned on Friday nights between 9:30 p.m. – 12:00 a.m., defendant failed to submit evidence that the restroom remained clean between that time and Monday morning when plaintiff’s accident occurred. 

 

05/03/18          Tavarez v. BJ’s Wholesale Club, Inc.

United States District Court, Southern District of New York

Summary judgment granted to retailer in slip and fall case pending in Federal Court based on diversity of citizenship even though the produce plaintiff fell on looked old and decayed

Plaintiff, while shopping at BJ’s, slipped and fell on an unknown substance and piece of produce in the electronics aisle of the store.  Plaintiff did not see the substance before falling, now was she aware how long it was on the floor before she encountered it.  Prior to her fall, plaintiff did not see a BJ’s employee in the area of the fall.  Following the fall, plaintiff reported the incident to BJ’s and also to her shopping companion, who examined the produce on the floor and described it as “decaying” fruit and vegetables.  He took photographs of the condition.  BJ’s maintenance supervisor, who was not working on the date in question, testified that there were approximately 5–10 maintenance staff members employed at that BJ’s location. Although the maintenance staff did not have specific written assignments, they were tasked to walk through the premises every 10–15 minutes.  Non-maintenance BJ’s employees were not required to routinely inspect the premises but, if they noticed debris on the floor, they were required to clean and report it.  The maintenance team did not keep records reflecting their inspection schedule or procedures in August 2014.   Here, Plaintiff does not contend that BJ’s created or had actual notice of the dangerous condition that caused her injury. Rather, she alleges that the evidence on the record creates an inference that BJ’s had constructive notice of the condition and should have rectified it. Both parties agree that the condition was “visible and apparent.  The parties disagree as to whether or not the condition existed for a sufficient length of time. Plaintiff argues that the photographs of “decaying vegetation” create a genuine issue of material fact as to whether the dangerous condition was present for a significant length of time and would have been remedied prior to the fall if BJ’s had exercised reasonable care. The Court rejected this contention finding it to to be speculative and unsupported by New York law. The Court reiterated that it is well-settled that the visible characteristics of rotten, old, or dirty food are insufficient to prove constructive notice.  Plaintiff further argued that BJ’s lack of specific evidence and documentation regarding its cleaning and maintenance practices that day creates a triable issue of fact.  The Court found that this argument incorrectly shifts the burden of proof at the summary judgment stage to the Defendant whereas Defendant is only required to demonstrate that Plaintiff lacks affirmative proof to demonstrate that there exists a genuine issue of material fact regarding constructive notice of the dangerous condition.

 

05/04/18          Cosgrove v. River Oaks Restaurants, LLC

Appellate Division, Fourth Department

Slip and fall snow and ice motion denied to restaurant owner

For restaurant owners in Western New York, maintaining their parking lots, sidewalks and entrances can be a tricky situation.  Plaintiff claims to have fallen on a patch of ice that was covered by a dusting of snow.  Defendant moved for summary judgment on the grounds it did not have actual or constructive notice of the condition.  The appellate court found that defendant did indeed meet its burden in establishing it did not have actual notice of the condition, therefore that portion of the trial court’s decision was reversed.  However, the court concluded questions of fact remained regarding weather the icy condition existed for a sufficient amount of time for the restaurant to correct it.  The court further concluded that questions of fact existed regarding whether the restaurant created the condition based on evidence of a prior repair made to the parking lot that could have contributed to the ice accumulation.  

 

Negligent Supervision, Municipal Claims, Assumption of Risk and Limited Services Contracts

By: Todd C. Bushway [email protected]

 

It’s amazing what a couple of warm sunny days will do after a very wet April – a sudden explosion of green.  The grass is growing, leaves are sprouting and there are flowers on the ground and on the branches.  Quite the welcome sight.  My daughter graduates from high school this coming weekend, meaning I’ve got yard work to do.  I need to ensure that there is a pleasant vista available when everyone crams into the kitchen to hang out.

 

Musically, my suggestions this month flow from a discussion with another music nerd who believes in the guitar first credo.  A discussion of new or up and coming punky/garage type bands led to some late night internet surfing that found several sites discussing bands generating buzz on the London club scene.  Several clicks later and I’ve now got some cool new stuff loaded onto the trusty iPod classic.  These are bands with at best one record to their name, and for some, just an EP or two.  Check out Shame, LIFE, Otherkin, and/or Catholic Action.  A similar sound can be heard from the American band The Royal Panics, as well as the Vaccines, a British band that have been around for 7-8 years, making them practically ancient to the bratty newcomers.  If you are like me and cut your teeth on late ‘70’s to early ‘80’s British rock (aka “New Wave”) this will be music to your ears.  I hear the Jam, Joy Division, the Cure, the Smiths, the Clash, early U2, the Alarm, PIL and a few others thrown into the blender.  It can never hurt to have good influences.

 

We have cases touching on two of the areas I try and track.  The first grouping looks at the primary assumption of risk doctrine, and more specifically the idea that allegedly improper instruction unnecessarily increases the risk of the activity – as most familiar with primary assumption of risk cases, one of the exceptions to the general rule is where the defendant has unnecessarily increased the risks beyond what would reasonably expect from the activity at hand.  One of those cases also addresses the validity, under General Obligations Law §5-326, of a release/waiver executed by a plaintiff before participating in the activity.  As a bonus of sorts, we have a primary assumption of risk and release case that illustrates one of the drawbacks of removing cases to federal court.

 

05/04/18          Jones v. Smoke Tree Farms

Appellate Division, Fourth Department

Primary assumption of risk, and the validity of a release under New York General Obligations Law §5-326.

Jones is a good reminder that defenses, claims or legal principles do not exist in a vacuum – depending on the facts of the case, there may be more than one theory or rule to consider, and the interplay between the theories need be considered.  In this case, the same question of fact vitiated the defendants’ plea for summary judgment. 

 

Jones addresses two potential defenses that may available to a defendant in a premises case – the validity of an release under the rule found in New York General Obligations Law §5-326 and the doctrine known as primary assumption of risk.  General Obligations Law §5-326 governs releases executed by participants, at the request of an owner, as a requirement for participating in certain activities.  In general terms, that statute limits the enforceability of such a release to activities or programs offered for educational purposes only.  A recreational purpose or focus will render the release unenforceable.  Primary assumption of risk holds that a voluntary participant in a sporting activity necessarily assumes the risks inherent in the activity.  Latent, unforeseen or unreasonably increased risks are not included in those assumed – in the most basic terms, the exceptions go to the idea that you cannot assume risks that you are unaware of.  Unlike New York’s comparative fault rule, primary assumption of risk will serve as an absolute defense.

 

Jones was injured when she fell from a horse while taking a riding lesson at the defendant’s facility.  Prior to participating in the lesson, plaintiff signed a release that included the following language:

 

[T]he undersigned assumes the unavoidable risks inherent in all horse-related activities, including but not limited to bodily injury and physical harm to horse, rider, employee and spectator.

 

In their answer, the defendants raised as affirmative defenses not only Jones’ own fault, but also that the executed by Jones release barred the claim.  Plaintiff moved for partial summary judgment to dismiss the affirmative defense based upon the release, alleging the release was void under General Obligations Law §5-326.  The defendants cross moved for summary judgment dismissing the plaintiff’s complaint.  The trial court, applying the primary assumption of risk doctrine, found that plaintiff had assumed the risks inherent in the activity and granted the defendant’s cross motion.  On appeal, the Appellate Division reversed the lower court’s ruling and addressed both the applicability of primary assumption of risk and whether the release was unenforceable under General Obligations Law §5-326.  Addressing primary assumption of risk first, the appellate court found a question of fact arose from plaintiff’s claim that the defendant had unreasonably increased the risk because its instructor neither adequately assessed nor provided instruction commensurate with plaintiff’s skill level – the lesson was plaintiff’s first and she fell while attempting to mount her noble steed.  Jones claimed she was obviously struggling while attempting to climb aboard the horse and the instructor failed to address her struggles. To support this argument, plaintiff submitted an expert affidavit calling into question certain of the instructor’s actions, pointing to a specific technique.   

 

The appellate court then addressed the validity of the release under General Obligations Law §5-326, a question deemed moot by the trial court after it found plaintiff had assumed the risk.  The appellate court analyzed the release and found the release valid because the activity plaintiff was engaged in was educational.  The court’s analysis of the release and §5-326 included three key findings, all of which focus on the character (education versus recreation) of the activity or program:

 

  1. Where a facility is ‘used for purely instructional purposes,’ section 5–326 is inapplicable even if the instruction that is provided relates to an activity that is recreational in nature. (Citations omitted); and

  2. Here, it is undisputed that plaintiff “enrolled in [a] course, paid tuition, not a fee, for lessons and was injured during one of her instructional periods” (Citations omitted; and

  3. [A]ny recreational use of defendants' facility was “ancillary to its primary educational purpose” (Citations omitted)

     

    That the release was valid under General Obligations Law §5-326 was only the first of a two part analysis necessary to determine if the release served to bar Jones’ claim.  The release, as is typical, stated that the plaintiff was assuming the risks inherent in riding horses – leading directly back to the question of whether the injury causing event fell within the risks assumed.  Pointing directly to the question of fact identified in its analysis of the defendant’s primary assumption of risk argument, i.e. that there was a question of whether the alleged deficiencies in instruction unreasonably increased the risk, the court deemed that summary judgment based upon the release was denied.  The Hon. Patrick H. Nemoyer added a written dissent, which raises, at least in my mind the question of from what distance the injury causing event should be viewed.  Judge Nemoyer argues that Jones’ injury was caused by nothing more than a fall from a horse, an obvious and expected risk apparent to even a novice.  Citing to long standing case law that an injured party need not foresee the exact manner of injury when the general risk is known, he reasons that any claim by plaintiff regarding the exact mechanism of her fall, including the issues identified by the expert, was irrelevant – a fall is a fall.  Judge Nemoyer added a footnote agreeing with the majority’s holding that the release was not barred by General Obligations Law §5-326, but did not comment on whether that release would serve as an independent ground to dismiss the case, although it seems reasonable to expect that his argument on the nature of the risk would carry through any §5-326 analysis.  Because Judge NeMoyer stands alone in his dissent, there is no automatic right of appeal to the Court of Appeals - a 3-2 decision at the Appellate Division is required for an automatic right to appeal and it is too soon to tell if the defendants will seek leave to appeal to the Court of Appeals.

     

    05/10/18           Thompson v. Windham Mountain Partners, LLC

    Appellate Division, Third Department

    Question regarding actions of resorts employees in allowing certain activities to occur in light of the evolving conditions created a question of fact on whether those actions unnecessarily increased the risks and blocked defendant’s motion for summary judgment on primary assumption of risk.

    The defendant is the operator of a resort offering a plethora of wintery activities.  As any self-respecting kid will readily tell you, the best of those activities are controlled by gravity and a slippery surface.  Ms. Thompson and her two young daughters were at the resort to enjoy the tubing facility.  The tubing are was set up so that the hill was divided into a series of lanes, created by piling snow into short berms or banks.  Within the tubing area were several “readily observable” metal poles, clad with padding and situated 30-70 feet from the outside of one of the tubing lanes. After several runs, plaintiff decided to ride in tandem with her daughters and specifically requested that they be spun around as they started down the hill.  On that fateful run, plaintiff’s tube went over the outside barrier for her lane and she struck one of the padded poles.

     

    Defendant, arguing the accident fell within the ordinary or accepted risks of tubing and that plaintiff had therefore assumed those risks by her voluntarily participation, moved for summary judgment, relying on photographs of the area, a manager’s testimony about how the lanes were constructed and plaintiff’s own testimony.  The court agreed that defendant had met their burden for summary judgment and turned to whether plaintiff had raised a question of fact.  Plaintiff argued that while plaintiff readily admitted that she chose to go tubing and had asked to be spun around while traveling down the hill, the conditions on the hill had changed during the day, with the banks between the lanes wearing down and the lane surfaces becoming hardened and icy, with a resultant increase in rider speed.  In fact, a manager testified that the resorts’ “lane safety attendants” were expected to make changes to what activities were allowed, including reducing the number of tubers allowed in single lane at the same time and prohibiting tubers riding in tandem.

     

    The court found this sufficient to raise a question of fact – that the alleged failure of the safety attendants to restrict or prohibit the activities plaintiff was engaged in while injured unnecessarily increased the risk inherent in the activity.

     

    We now have reported several times in the last six columns or so on cases where a question of fact was found as a result of an argument that the actions taken (or not) and/or the instruction or direction given by a person charged with supervising or directing the injury created an unreasonably increased risk, not surprisingly one of the stated exceptions to the primary assumption of risk rule.  Whether this is a trend or not would need further study but I do think that this highlights an important consideration when looking at a case through the primary assumption of risk lens – It’s not just the type of activity or the field conditions – if the activity is supervised or directed by an agent or employee of the defendant, his or her actions in overseeing or directing the activity needs to be considered. 

     

02/26/18          Ward v. Stewart

United States District Court, Southern District of New York

A cautionary tale about a potential downside of removing a case from a New York state court to the United States District Court.

The Ward decision does not assess whether the applicability of primary assumption of risk or the validity of a release under General Obligations Law §5-326, although those issues underlie the decision.

Factually, the case arises from a tragic 2014 accident during a sprint car race at the Canandaigua Motorsports Park east of Rochester, involving well known NASCAR driver Tony Stewart and local driver Kevin Ward.  Stewart was scheduled to race in a NASCAR race at the famed Watkins Glen track the day after the accident and had traveled the short distance to Canandaigua to compete in the sprint car race the night before.  During the sprint car race, Ward’s car crashed into the track wall, leading to a yellow caution flag for the rest of the field.  Instead of following protocol and waiting for track officials to come to his car, Ward exited his vehicle and walked back onto the track and gestured and pointed at Stewart’s oncoming car, apparently believing Stewart had caused his crash.  Ward was struck by the rear tire of Stewart’s passing car and sustained fatal injuries.   The Ward family accused Stewart of deliberately striking Ward, claiming that Stewart had failed to slow his vehicle as required by the caution flag and had deliberately steered his car towards Ward immediately prior to the collision.  A grand jury was convened to hear the case, but declined to indict Stewart, much to the Ward family’s displeasure.  The Ward family brought a wrongful death case against Stewart, who removed the matter from New York State Supreme Court the Unites States District Court.  Following discovery, Stewart moved for summary judgment on two grounds – (1) that the release signed by Ward prior to participating in the race barred any claim, and (2) that Ward’s death was the result of a risk inherent in racing, a risk he had knowingly assumed by his participation.  The district court rejected both defense arguments, finding the race a recreational activity and therefore the release unenforceable under General Obligations Law §5-326, and that there was a question of fact as to whether Stewart’s alleged conduct during the caution flag were among the risks Ward had assumed.

 

This now brings us to our point – one of the significant differences between New York and federal civil procedure involves the right of appeal.  New York allows interlocutory appeals (CPLR §5701; i.e. the appeal may be taken following the ruling in question) while federal procedure (28 U.S.C.A §1291) allows appeals only from a final judgment.  In the case of a summary judgment motion, a New York state party may appeal directly from the decision granting or denying the motion; in federal court, party cannot appeal a similar decision until after the case is finally determined – meaning that Stewart had no right of appeal from the denial of his motion for summary judgment, since the Ward estate’s claim against him had not yet finally been determined.  Had the defense motion been granted, Ward’s estate could have appealed, as the granting of the motion would have represented a final determination of its claim.

 

The federal rules, at 28 U.S.C.A §1292(b), do allow for a party seeking an interlocutory appeal to petition the district court to certify a question for immediate appeal, but only under certain, very limited circumstances.  One of those exceptions is a showing by the petitioner that there are substantial grounds or basis for a difference of opinion on a controlling or determinative question of law and that there is “genuine doubt” that the court, in rendering its decision, did not apply the correct legal standard or rule.  The standard is meant to set a high bar.  Stewart sought leave for an immediate appeal, arguing the district court’s determination on the enforceability of the release executed by Ward and the supposed question of fact found by the court in reviewing Ward’s assumption of risk met the standard detailed above.  Central to his argument was that the court’s ruling on the enforceability of the release, as against a fellow driver, and the court’s finding of a question of fact on the assumption of risk had the potential to “end the entire automobile racing industry in the State of New York.”  That application was denied.

 

In denying the application, the court felt the need to comment that Stewart’s “hyperbolic account” of the dire consequences the court’s ruling might bring to bear on New York’s racing traditions was “borne of necessity” – Stewart’s decision to remove the case to federal court now blocked the immediate, interlocutory appeal he now sought.  As a side note, although the Canandaigua race was not a NASCAR sanctioned event, the accident did lead to a change in NASCAR rules. Within a week of the accident, NASCAR changed its rules to require that any driver whose car was involved in an accident and was unable to drive the car under its own power off the track (i.e. into the pits or garage area).  Emergency situations – for example a fire – are the only exceptions to the rule.

 

Toxic Exposures

By: V. Christopher Potenza [email protected]

 

Spring has finally arrived and now I start my second job of herding cats, i.e. toddler tee ball and soccer.  Calling these “organized” team activities is a bit of a misnomer, but the sun is shining and I’m outside, so I can’t complain.

Nothing to report from the courts on asbestos or lead paint this month, but there is an interesting products decision from the First Department addressing the liability of a retailer and distributor for failure to heed the specification from the manufacturer of a drain opener prohibiting the sale to non-professionals.

And now a dad joke approved by my daughter:

 

Why can’t Cinderella play soccer…. because she runs away from the ball.

 

04/12/18          Janiya W.-G. v Smith

Appellate Division, First Department

Retailer and distributor of drain opener faces liability for failure to follow manufacturer’s specification prohibiting sale to non-professionals.

The infant plaintiff was allegedly injured from ingesting a drain-opener that was sold in a retail variety store and had a 93% concentration of sulfuric acid. At the outset, the Court noted that there is no claim for strict products liability because the plaintiff did not allege that the sulfuric acid drain opener that allegedly caused her injuries was defectively designed or manufactured or that there was a failure to warn.  The issue, however, was whether the distributor and retailer face liability for the sale of this product to a non-professional consumer in a retail setting.  The Court ultimately determined that an issue of fact existed as to whether or not the retailer and distributor violated an industry standard when it failed to follow the manufacturer's prescribed safety instructions.  Particularly fatal was the testimony of the distributor’s chief of operations, who agreed that potentially hazardous chemicals should be handled in accordance with the manufacturer's specifications.  In this case, those specifications prohibited sale to non-professionals.

 

Homeowner Liability and Recreational Accidents

By: Tessa R. Scott [email protected]

 

Dear Readers:

 

Sometimes it is nice to return to the basics.  This month the Second Department has provided us with several cases that nicely outline the basic landowner liability.  Notably, the Second Department issued a decision concerning trivial defect. The trivial defect defense goes something like this:  What defect?! That!? That is so small, inconspicuous, so insubstantial, so meaningless… For all those premises law fans out there, you know this is an area of law that recently started to evolve.  

 

Historically, this has been a fairly effective defense for defendants. However, recently the strength of this defense has come under scrutiny.  In 2015, the Court of Appeals considered three cases and rendered a singular decision, Hutchinson v. Sheridan Hill House Corp. The overarching takeaway from Hutchinson was that measurements and dimensions cannot alone establish triviality. The Court of Appeals must consider the alleged defect and the surrounding circumstances.  As such, the evaluation requires consideration of many factors and evidence.  As a result of Hutchinson, attorneys are now on the lookout for clarification on what factors the court considers and what weight the evidence is given. The case we have this month doesn’t provide too much insight on that front, however, the Second Department dismissed liability against the defendant, indicating that the trivial defect defense is alive and well. 

 

I hope everyone has a wonderful week!

 

Tessa

 

04/11/18          Hopkins v St. Agnes R.C. Church at Rockville

Appellate Division, First Department

The difference between the riser height and the step was a trivial defect

Plaintiff fell while descending the exterior staircase of a church owned by the defendant. The plaintiff alleged that the accident resulted from a difference in riser height between steps on the staircase. The defendant moved for summary judgment dismissing the complaint on the ground that the alleged dangerous condition was trivial and, therefore, not actionable as a matter of law. The Supreme Court granted the defendant's motion, and the plaintiff appeals.

 

"Generally, the issue of whether a dangerous or defective condition exists depends on the facts of each case and is a question of fact for the jury.” “A defendant seeking dismissal of a complaint on the basis that the alleged defect is trivial must make a prima facie showing that the defect is, under the circumstances, physically insignificant and that the characteristics of the defect or the surrounding circumstances do not increase the risks it poses.” “In determining whether a defect is trivial as a matter of law, the court must examine all of the facts presented, including the width, depth, elevation, irregularity and appearance of the defect along with the time, place and circumstance of the injury.”

 

Here, The Second Department concluded that defendant did meet its burden to show the alleged defect was trivial. The issue of trivial defect has evolved recently and become more difficult to establish for defendants. Unfortunately, here the Second Department did not explain what evidence it considered.

 

04/11/18          Miano v Rite Aid Hdqtrs

Appellate Division, Second Department

The root of the matter; landowners will not be held liable for injuries arising from a condition on the property that is inherent to the nature of the property.

Plaintiff tripped and fell as he was walking on a landscaped area on the defendants' property. The plaintiff testified at his deposition that on the date at issue, he had parked his vehicle in the defendants' parking lot and then stepped up over a curb and walked through a landscaped area of the grounds adjacent to the parking lot as a way of accessing the sidewalk to the defendants' store. The landscaped area consisted of trees, shrubs, and mulch, and near the plaintiff's parking spot, there was a gap in the shrubbery. The plaintiff was walking through the gap when he tripped and fell on a root just below the surface of the mulch. The defendants moved for summary judgment dismissing the complaint, and the Supreme Court granted the motion.

 

A landowner has a duty to exercise reasonable care in maintaining its property in a safe condition under all of the circumstances, including the likelihood of injury to others. However, a landowner "will not be held liable for injuries arising from a condition on the property that is inherent or incidental to the nature of the property, and that could be reasonably anticipated by those using it.” Here, the defendants established their entitlement to judgment by demonstrating that the root that had caused the plaintiff to trip and fall was inherent or incidental to the landscaped area and that it could be reasonably anticipated by those using it.

 

04/25/18          Espinosa v Fairfield Props. Group

Appellate Division, Second Department

Landlords do not have a duty to protect from conditions that open and obvious.

The plaintiff allegedly was injured on property owned by the defendants when she stepped from a red-brick walkway onto an adjacent lawn and fell on a downwardly sloped strip of gray-colored cement situated between the walkway and the grass.

 

Although, a landowner has a duty to maintain its property in a reasonably safe manner, it does not have a duty to protect from conditions that are open and obvious. Here, the evidence submitted by the defendants in support of their motion, including photographs of the accident site that were authenticated by the plaintiff, established, that the cement area at issue was, as a matter of law, readily observable and not inherently dangerous.

 

05/02/18          Bousquet v Water View Realty Corp

Appellate Division, Second Department

An abutting landowner is only liable for injuries occurring on public sidewalks when it either created to condition or a statutory duty is imposed.

Plaintiff tripped and fell on an uneven condition on a sidewalk abutting property owned by the defendant Water View Realty Corp.   Generally, when a person is injured on a public sidewalk the municipality is the appropriate party to the action.  However, an abutting landowner will be liable when the owner either created the condition or caused the defect to occur because of a special use, or when a statute or ordinance places an obligation to maintain the sidewalk.  Here, Water View did not create the alleged condition or cause the condition through a special use of the sidewalk. Additionally, although section § 180-2 of the Code of the Village of Freeport requires an abutting landowner to keep a sidewalk in good and safe repair, it does not specifically impose tort liability for a breach of that duty.

 

Snow and Ice, Storm in Progress, Tavern Owner/Dramshop Liability and Other Timely Topics

By: Anastasia M. McCarthy [email protected]

 

Dear Readers,

 

One of the side-effects of a career in civil defense is the inescapable (and occasionally advantageous) ability to detect potential danger at every turn. Sometimes it feels like nothing escapes my now-attuned hawk-eye—the uneven pavers in a friend’s driveway; an over or under salted driveway; the toddler in a department store who leaves a trail of destruction and tripping hazards in his wake.  Still, I am by far, the least graceful and most-accident prone member of the Premises Pointers squad (for frame of reference, my childhood nickname was “Anastasia Bump” because I frequently, ran, walked and fell into things).  Bearing all of this in mind, it would probably surprise many of you to know that I recently purchased a home with an in-ground swimming pool, which at this point is a source of both stress and pride.  I am really looking forward to hosting family and friends throughout the summer, but I am also extremely nervous about maintaining a cement-lined open pit filled with water and chlorine in my backyard.

 

This month’s cases harken back to simpler times—winter (and one bar fight that seems reminiscent of an ill-spent youth; but not my youth, of course).  We have three failed summary judgment motions—one in which plaintiff introduced various affidavits to create a question of fact about the existence of ice in a parking lot; one in which plaintiff’s deposition testimony alone, which conflicted with defendant’s testimony and climatological data, was enough to raise a question of fact about the weather at the time of loss; and one dram shop/tavern liability case where plaintiff and defendant’s motions for judgment as a matter of law were both denied.  We also have a write-up about a defense verdict in an interesting auto-premises hybrid case wherein two plaintiffs, allegedly attempting to avoid ice on a sidewalk, walked out into the middle of the street (while talking on a cellphone) and were struck by a vehicle.

 

02/22/18  Torgersen v. A&F Black Creek Realty, LLC v. Dale A. Larkin d/b/a Al Larkin & Sons

Appellate Division, Third Department

The one where post-deposition Affidavits saved Plaintiffs’ claims from dismissal.

Plaintiff and his wife filed suit after Christopher Torgersen slipped and fell in the parking lot of their apartment complex.  At the time, Mr. Torgersen was returning home from work and had just parked his vehicle in a parking spot covered with snow.  Following the incident, Mr. Torgersen and his wife commenced an action against their landlord, A&F Black Creek Realty, LLC.  A&F then filed a third-party complaint against their snow plow contractor, Dale Larkin.

 

At the close of discovery, Larkin and A&F each filed motions for summary judgment.  The trial court granted A&F’s motion and dismissed Larkin’s as moot. Plaintiffs appealed to the Appellate Division.

 

On review, the Third Department reiterated the well-established principle that, in a slip and fall case, a defendant moving for summary judgment must first demonstrate that it maintained the premises in a reasonably safe condition and that it did not create or have notice, actual or constructive, of the specific, allegedly dangerous, condition that caused plaintiff’s injury.  Notably, constructive notice requires that the alleged defect have been visible, apparent, an in existence for enough time that defendant should have discovered and repaired it. 

 

The Court examined the evidence set forth both all parties and found that A&F and Larkin met their initial moving burdens on summary judgment.  Both A&F and Larkin submitted:  deposition testimony and affidavits establishing that neither entity received any prior complaints of slippery conditions before plaintiff’s accident; deposition testimony and affidavits establishing that tenants were obligated to move their vehicles before Larkin could plow and that even if vehicles were not removed, Larkin plowed around them and A&F removed additional snow and spread salt in the vicinity of parked vehicles; employee testimony that this process was followed on the date of loss and that the employee also inspected the lot throughout the day; business records showing that Larkin plowed, salted and sanded on the morning at-issue; deposition testimony from plaintiff that it was not snowing when he left for work and that he observed the sidewalks and parking lot being cleared; and deposition testimony that when he returned home from work that evening, he parked in a parking spot that was covered by a few inches of snow that appeared to be the result of someone brushing snow off of their windows. 

 

In opposition to this showing, plaintiffs submitted:  an Affidavit from Mr. Torgersen that his legs “kicked” out from under him on ice that was covered with snow and obscured by poor lighting; and an Affidavit from another tenant of A&F who claimed that she saw plaintiff fall, observed a large ice patch in the vicinity, and that the parking lot had not been plowed and salted and was frequently the subject of complaints.

 

In response to plaintiffs’ showing, Larkin and A&F raised numerous arguments challenging the credibility of plaintiffs’ proof.  The Third Department determined that plaintiff’s affidavit itself was not inconsistent with the deposition testimony such that it should be rejected and that there was no reason to discount the tenant’s affidavit because it could find no motivation for the tenant to lie.  More importantly, the Court stated that it would not engage in an assessment of the tenant’s credibility absence evidence that the affidavit was “clearly feigned.”

 

Ultimately, unlike the trial court, the Third Department found plaintiffs’ evidentiary showing sufficient to raise a questions of fact regarding the role of the ice and poor lighting in plaintiff’s fall and whether the ice was present due to inadequate salting and should have been discovered or remedied.

 

03/28/18          Zempoalteca v. Ginsberg, et al.

Appellate Division, Second Department

The one where climatological data alone was insufficient to establish that a storm was in progress at the time of the fall.

Plaintiff brought suit after he slipped and fell on the sidewalk abutting defendants’ Brooklyn property.  Defendants moved the trial court for summary judgment, arguing that the storm in progress rule applied to the action.    The trial court denied the motion and the Second Department affirmed.  Specifically, the Second Department determined that defendants failed to establish prima facie entitlement to judgment in their favor because, as part of their showing, defendants produced deposition transcripts of Mr. Ginsberg and plaintiff who each provided conflicting testimony as to the weather conditions at the time of loss.  Although defendants also produced climatological data for nearby areas, the Court determined that this information was insufficient on its own “to demonstrate, prima facie, that the storm in progress rule applied.”

 

03/15/18  Gagnier v. Cline

Supreme Court, Eighth Judicial District, Erie County, New York

The one where the jury returns a verdict in favor of defendants after evidence of plaintiffs’ own negligence and storm in progress is introduced.

Two sisters, Janine and Robyn, were walking on a sidewalk in Tonawanda, New York when they started to slip.  As they attempted to cross to the other side of the street, plaintiffs stepped out onto the roadway and were struck by a vehicle operated by Defendant Cline.  Janine alleged that she sustained a right grade 1 open distal tibia-fibula fracture, loss of consciousness, a broken nose, road rash, and abrasions to the left foot and hip; Robyn alleged various injuries.  The sisters then commenced suit—specifically, plaintiffs brought suit against the driver of the vehicle (Cline) as well as the owner of the vehicle and the company that maintained the alleged slippery sidewalks.  Defendants, individually, set forth a number of defenses and, at trial, introduced evidence that—the vehicle owner (Herbst) and the vehicle operator (Cline) argued that Janine was negligent and assumed the risk.  The company that maintained the sidewalk (Pearce) argued that the sisters crossed in the middle of the block, outside of a crosswalk that was nearby; failed to take a reasonable alternative route; chose to enter the roadway instead of walking through a mere two inches of snow; stepped into the path of a moving vehicle; and was using a cell phone at the time of loss.  More importantly, Pearce asserted that a storm was in progress at the time of loss.

 

03/14/18  Tansey v. Coscia, et al.

Appellate Division, Second Department

The one where plaintiff loses a summary judgment motion.

After plaintiff was struck in the head by an intoxicated bar patron, he brought a lawsuit against the bar owner alleging that the bar was negligent and violated the Dram Shop Act when it served a visibly intoxicated person alcohol and/or to a person actually or apparently under the age of twenty-one.  At the close of discovery, the defendant-bar owner moved for summary judgment and plaintiff cross-moved for the same.  The Court denied both motions and plaintiff appealed.

 

The Second Department affirmed the trial court’s denials, stating that the submissions of both parties revealed the existence of triable issues of fact about—whether or not the bar served alcoholic beverages to the tortfeasor when he was visibly intoxicated; about whether the bar served alcohol to the tortfeasor despite knowing (or having reasonable cause to know) that he was under the age of twenty;  and about whether there was a reasonable or practical connection between the service of alcohol to the tortfeasor and plaintiff’s injuries.  The Appellate Court also determined that the trial court properly dismissed the bar’s motion for summary judgment on plaintiff’s negligence cause of action because the bar failed to establish, prima facie, that the attack on plaintiff was not foreseeable.

 

The Ups and Downs of Elevator and General Litigation

By: James L. Maswick [email protected]

 

In keeping with current weather trends in the Adirondacks, we have once again seemingly gone from winter directly into summer. I cannot remember the last spring-time weather we had here. This winter hung on gamely this year with ice not being out of Lake Placid until May 8, 2018 at 1:35pm. This is the latest official “ice out” since 1978, according to the official “IceMeisters” of Lake Placid.

This month, we are back to looking at cases involving elevators which have been decided over the last month or so. Our foray into the the decision from the Court of Appeals on contributory negligence and summary judgment certainly was important enough for me to ignore elevator and escalator topics for the month. In the event that you are interested in reading the article on the Rodriguez v. City of New York decision, please do not hesitate to contact me via email at [email protected] and I will be pleased to send you a copy of my write up.

05/01/18          Pacheco v. Serviam Gardens Associates, L.P.

Appellate Division, First Department

Elevator Company obtained summary judgment in alleged surprise elevator closure case. Plaintiff claimed that an elevator door closed unexpectedly on her while she stood at the entrance way of an elevator and talked to her friend for about a minute. The plaintiff testified that after the door struck her and caused injury, they retracted. The defendant elevator company Kone, Inc. moved for summary judgment and the Court granted the elevator company’s motion.

The Court found plaintiff failed to raise a triable issue of fact and found res ipsa loquitur not applicable under the circumstances because there was no evidence that Kone was negligent.   Based on plaintiff’s deposition testimony, she could have had voluntary actions which caused the accident. Kone also provided service records which showed that it regularly inspected the elevator, it was operating properly before the accident and submitted an affidavit of employee who knew of no prior complaints with the subject elevator. The Court found Kone had no actual or constructive notice of any defect in the elevator.

 

Lastly, the Court chided the plaintiff’s expert for a conclusary affidavit, a frequent issue on summary judgment in many elevator cases. As always, it is important to have the strong expert affidavit if you are moving for summary judgment in an elevator case and representing a defendant elevator company to spell out for the Court why there are no issues of fact which should be tried.

 

05/08/18          Lilly v. City of New York

Appellate Division, First Department

Plaintiff’s case survives summary judgment when unexpected door closure occurs.

Similarly to the above case, Lilly involved a plaintiff who was allegedly injured when elevator doors unexpectedly closed as the plaintiff attempted to enter the elevator. The First Department here found that res ipsa loquitur was applicable under the circumstances presented, in denying the defendant building owner New York City Housing Authority’s motion for summary judgment, since the plaintiff testified that the elevator door which closed on him did not have rubber safety bumpers and suddenly and unexpectedly closed.

 

Buttressing the findings that the case should not be decided on summary judgment and res ipsa loquitur is applicable, plaintiff also testified that the elevator door was malfunctioning for several months in the building in which he lived. An affidavit by another tenant also indicated the elevator doors were malfunctioning. The Court found that this was enough constructive notice to defeat the Housing Authority’s evidentiary showing that the elevator was in good working order and had regular maintenance.

 

As you can see, the difference between the two cases can be seen in that plaintiff, in Pacheco was standing in the elevator door for some time and Lilly was simply entering an elevator door. Further, the importance of finding non-party witnesses to any elevator door issues previously is seen, as the non-party witness in Lilly provided important testimony in favor of the plaintiff.

 

 

03/20/18          Ling Hue Chiu v. UOB Realty (USA) Limited Partnership

Supreme Court, Queens County

Defendant Elevator Company unsuccessful in obtaining summary judgment in fast fall elevator case.

Plaintiff went to the building, owned by defendant UOB Realty, in which she worked. She was employed by a different entity that had offices in UOB Realty’s building on the tenth floor. At the end of a work day, she pressed the button to open the elevator and the doors opened more quickly than usual. She entered and the doors closed behind her more quickly than usual. She then pressed the appropriate elevator button to descend and the elevator began traveling extremely fast, causing the plaintiff to grab the edge of the elevator button panel to avoid falling. The fall lasted about five seconds and there was no other movement of the elevator aside from the drop. This allegedly caused her personal injuries.

Just two days prior to this incident, the plaintiff testified that when she was riding in the same elevator, there was a “big shake” and the elevator “fell”, coming to a hard landing in the lobby. She had advised the security guard named Eric that something was wrong and Eric had told her that the elevator was being worked on. Plaintiff also advised there had been an additional incident in the six months prior, but that she had kept it to herself. Strikingly, she testified that she had elevator difficulties at least three times per year in the seven years prior to this incident in going to work at this building.

The elevator company submitted records which indicated that there were no prior complaints regarding this elevator traveling at speed or sudden stoppings of the elevator. There were incidents at the elevator which involved items such as the door locks and operator board, however the elevator company employees testified that these had nothing to do with the governor or safety brake on the elevator and were merely related to door function. There had been other shut downs of this elevator, including an instance when all of the building’s elevators had stopped on the fifth floor and the fifth floor call board had to be replaced. However, the elevator company’s expert testified that none of the prior maintenance issues which had presented with respect to the elevator could cause an overspeed issue, nor would they relate to the function of a governor on an elevator or cause of sudden stop. He concluded that because none of these prior issues were related, there was no actual or constructive notice of any defective issue.

The Court noted that plaintiffs admitted an affidavit which indicated the elevator had failed to pass routine inspections by the New York City Department of Buildings in the four years prior to the accident. The plaintiff’s expert also testified that the most probable cause of the incident was a clipping or malfunction of the tenth floor interlock and that without ninety minutes to two hours of preventive maintenance a month, operational problems could likely ensue. There was no record of any preventive maintenance conducted to the interlock system in the twelve months preceding the incident, however.

The Court, crediting plaintiff’s expert’s opinion and noting the prior instances of elevator maintenance problems, plaintiff’s expert’s opinion that the issues with the interlock could have caused the sudden stop and plaintiff’s own testimony involving the elevator, the Court found defendants had failed to establish their entitlement to summary judgment. The Court recognized the plaintiff’s testimony with the prior instances with the elevator (though one has to question why they would continue to get into an elevator if they encountered so many difficulties) and also found that based on plaintiff’s testimony and the failure to conduct preventive maintenance that the defendant elevator company failed to demonstrate it lacked notice of the malfunctioning of the elevator. Further, it was decided that there a question of fact between the two experts’ opinions that the elevator company failed to use reasonable care to discover a condition it should have found. Completing the rout for the plaintiff, the Court also found that res ipsa loquitur was appropriate in this instance, as the elevator company was the exclusive entity which maintained the elevators and the fact that there was no evidence that plaintiff had contributed to how this accident occurred, the defendant elevator company had failed to rule out res ipsa loquitur as a possible basis of negligence.

New York Discovery Angles

By: Marc A. Schulz [email protected]

 

Greetings Premises Pointers Subscribers,

Last month, my wife and I spontaneously drove to Cleveland to watch the Cavaliers play the Pacers, and LeBron James made the game winning three-pointer as time expired! Cleveland is a fun city. As for this issue, we are delighted to report on the first post- Forman v Henkin case, which we brought to you in our February issue, regarding social media demands which the Court found overbroad and not reasonably tailored to obtain discovery relevant to the issues in the case. We will continue reporting on how the Appellate Division applies Forman to social media demands.

 

I also highlight two Appellate Division cases applying the “alter ego” status. Generally, employees injured in the course of their employment may recover against their employers only under the Workers’ Compensation Law, which under § 29(6) expressly provides “[t]he right to compensation or benefits under this chapter, shall be the exclusive remedy to an employee”. As discussed in the Clarke and Buchwald cases, the exclusive remedy provisions also bar employees from seeking damages from “alter egos” of their employers, which applies when one of the entities controls the other or when the two entities operate as a single integrated entity. Be aware, however, a mere showing that the entities are related (e.g. sharing officers or ownership) is insufficient. The factors outlined in Bunchwald provide clarity for those interested. Shoot me an email if you wish to discuss this further. Until next time …

 

Marc

04/18/18          Watson v 518 Pa. Hous. Dev. Fund Corp.

Appellate Division, Second Department

Defendants’ failure to provide relevant documents that were demanded and failure to offer any excuse for failing to do so warranted order of preclusion but not striking of defendants’ answer

The trial court denied plaintiff’s motion to strike defendants’ answer or alternatively for an order of preclusion in this personal injury action when he was shot by an intruder while in defendants’ building allegedly due to defendants’ failure to maintain the building’s entrances and to properly secure the building. Motion practice followed plaintiff’s demands for records regarding the condition of the building’s entrances and locks. Defendants submitted an affidavit detailing efforts to provide the names and addresses of various former employees, and another affidavit from their principal stating the building had been transferred to a third-party and all documents other than the “tenant file” already produced, were now with the new owner.

 

When the new owner informed plaintiff it did not possess any of the requested documents, plaintiff filed this instant motion to strike/preclude. The Second Department held plaintiff failed to sustain his burden of establishing spoliation occurred as there was no evidence submitted that the requested documents ever actually existed, and plaintiff also did not establish that the absence of any such documents deprived him of his ability to prove his claim.

 

However, the Court held plaintiff should have been granted the alternative relief of an order of preclusion because defendants failed to produce relevant documents that were directed to be produced as a result of preliminary conference orders, which subsequently led to two motions by plaintiff to compel compliance, and offered no excuse for their conduct in failing to do so. Accordingly, plaintiff was entitled to an order of preclusion to the extent of precluding defendants from offering at trial any document not produced in response to plaintiff’s discovery demands.

 

04/25/18          Clarke v First Student, Inc.

Appellate Division, Second Department

“Alter ego” status serves to completely bar employee’s slip and fall claim under the defense of exclusivity of Workers’ Compensation Law

Plaintiff allegedly was injured when she fell due a defective condition at FSM’s place of business. The trial court denied defendant’s motion for summary judgment dismissing the complaint on the grounds that defendant and plaintiff’s employer were functionally the same entity with respect to the exclusivity provisions of the Workers’ Compensation Law §§ 11 and 29(6).

 

The exclusive remedy provision also bars employees from seeking damages from “alter egos” of their employers, and applies when one of the entities in question controls the other or when the two entities operate as a single integrated entity. In this case, defendant submitted evidence that in addition to owning the premises, it was the sole owner and manager of the limited liability company that was plaintiff’s employer, that plaintiff’s employer was formed to provide bus drivers for defendant’s pupil transportation business, and that the two entities share the same Workers’ Compensation insurance policy. As a result, defendant’s motion for summary judgment should have been granted.

 

04/26/18          Doe v Bronx Preparatory Charter Sch.

Appellate Division, First Department

Demands for access to social media accounts for five years prior to the incident, and to cell phone records for two years prior to the incident, were overbroad and not reasonably tailored

The trial court denied defendant’s motion for an order precluding plaintiff’s evidence and testimony at trial and compelling plaintiff’s social media accounts for five years prior to the incident and her cell phone records for two years prior to the accident.

 

The First Department unanimously affirmed, holding defendant failed to show plaintiffs had not complied with a prior discovery order, and plaintiffs provided access to infant plaintiff’s social media accounts and cell phone records for a period of two months before the date on which she was allegedly attacked on defendant’s premises to the present, which the Court found was a reasonable period of time.

 

04/27/18          Buchwald v 1307 Porterville Rd., LLC

Appellate Division, Fourth Department

Where two entities “functioned as one company, defendant “alter ego” of plaintiff’s employer, thereby precluding plaintiff’s negligence claim

Plaintiff allegedly fell from the hayloft of a barn located on property owned by defendant and leased by plaintiff’s employer to operate a horse farm business on the property. The trial court granted defendant’s motion for summary judgment dismissing the complaint on the grounds that defendant and plaintiff’s employer were alter egos and thus plaintiff’s action was barred by the exclusivity remedy provisions of Workers’ Compensation Law §§ 11 and 29(6).

 

“Factors relevant to the determination of that issue include whether the two entities share a common purpose, have integrated or commingled assets, share a tax return, are treated by the owners as a single entity, share the same insurance policy, and share managers or are owned by the same person. Additional factors include whether the alter ego has any employees, whether the alter ego leases property pursuant to a written lease or pays rent to the plaintiff’s employer, and whether one entity pays the bills for the other even if those bills are for the benefit of the nonpaying entity”.

 

In this case, the Fourth Department unanimously affirmed the trial court’s finding that as a matter of law defendant was the alter ego of plaintiff’s employer as they were single-member-owned LLCs created on the same day “for a single purpose, to operate a horse stable business”, had the same individual owner, reported their taxes on the same tax return, and shared the same insurance policy.

 

The Court noted defendant had no separate set of financial books, no separate accounting or tax reporting, no employees, and “was formed solely for the purpose of owning the premises upon which plaintiff’s employer … operated” its horse farm. Plaintiff’s employer leased property from no one other than defendant, there was no written lease agreement, and plaintiff’s employer did not pay any rent to defendant. Thus, defendant established it had no employees, was controlled by the individual that controlled plaintiff’s employer, and that the two entities “functioned as one company”.