Colnaghi, U.S.A., Ltd. v. Jewelers Protection Services, Ltd.

• Decision Date: 23 February 1993
• Citation: 595 N.Y.S.2d 381,611 N.E.2d 282,81 N.Y.2d 821
• Parties: , 611 N.E.2d 282 COLNAGHI, U.S.A., LTD., et al., Respondents, v. JEWELERS PROTECTION SERVICES, LTD., Appellant, et al., Defendants. (And Another Action.)
• Court: New York Court of Appeals Court of Appeals

Page 381

595 N.Y.S.2d 381

81 N.Y.2d 821, 611 N.E.2d 282

COLNAGHI, U.S.A., LTD., et al., Respondents, v. JEWELERS PROTECTION SERVICES, LTD., Appellant, et al., Defendants.

(And Another Action.)

Court of Appeals of New York.

Feb. 23, 1993.

[81 N.Y.2d 822] [611 N.E.2d 283] Conway, Farrell, Curtin & Kelly, P.C., New York City (Jonathan Uejio, of counsel), for appellant.

Mound, Cotton & Wollan, New York City (Renee Plessner, of counsel), for respondents.

OPINION OF THE COURT MEMORANDUM.

The order of the Appellate Division should be reversed, with costs, defendant's motion for summary judgment dismissing the complaint and the third-party complaint granted, and the certified question answered in the negative.

Jewelers Protection Services, Ltd. (Jewelers), an alarm company, contracted with Colnaghi, U.S.A., Ltd. (Colnaghi), an art gallery, to install, maintain and monitor two burglar alarm systems at Colnaghi's Manhattan premises. On February 8, 1988, burglars broke into the gallery through an unprotected skylight and stole 20 paintings, including two owned by Umberto Melina that had been consigned to Colnaghi for sale.

Colnaghi and its insurer commenced an action against Jewelers sounding in tort and breach of contract, seeking $10,000,000 in damages. Similarly, in a separate action, Melina sued Colnaghi and Jewelers. Finally, in the latter case, Colnaghi sought contribution against Jewelers in the event it was found liable to Melina.

Jewelers moved for summary judgment dismissing both complaints and Colnaghi's contribution claim, relying in part on clauses in its subscriber agreement exonerating it from liability for negligence. Supreme Court denied the motions in their entirety, finding an issue of fact on gross negligence that would, in the court's view, vitiate the contractual exoneration provisions.

The Appellate Division modified by dismissing Melina's action against Jeweler's, holding that Jeweler's had no duty to the consignor. (Melina has not appealed from that determination and it is therefore not before us.) The Appellate Division, however, agreed with Supreme Court that Colnaghi raised a triable issue of fact on gross negligence, inasmuch as the gallery's alarm expert asserted, in an affidavit, that the alarm company's failure to provide any protection to the skylight created a "major vulnerability" in the alarm system at a likely burglar entry point, rendering the system "far below professional standards and customary practice in the industry." (183 A.D.2d 469, 470, 583 N.Y.S.2d 427.) We reverse and grant Jeweler's motions for summary judgment.

We note at the outset that, like the parties in Gutter Furs v. Jewelers Protection Servs., 79 N.Y.2d 1027, 584 N.Y.S.2d 430, 594 N.E.2d 924, the issue as framed by the litigants is whether there is a triable issue of fact on gross negligence. No argument is presented here that plaintiff's remedies are limited to breach of contract and that no tort action lies at all (compare, Sommer v. Federal Signal Corp., 79 N.Y.2d 540, 550-553, 583 N.Y.S.2d 957, 593 N.E.2d 1365).

New York law generally enforces contractual provisions absolving a party from its own negligence (Sommer v. Federal Signal Corp., 79 N.Y.2d, at 553, 583 N.Y.S.2d 957, 593 N.E.2d...