City of New York v. Charles Pfizer & Company, Inc.

• Court: New York Supreme Court — Appellate Division
• Citation: City of New York v. Charles Pfizer & Company, Inc., 260 A.D.2d 174, 688 N.Y.S.2d 23 (N.Y. App. Div. 1999)
• Decision Date: 06 April 1999
• Parties: CITY OF NEW YORK et al., Appellants,<BR>v.<BR>CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 1.)<BR>CITY OF NEW YORK et al., Appellants,<BR>v.<BR>CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 2.)<BR>CITY OF NEW YORK, Appellant,<BR>v.<BR>CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 3.)

260 A.D.2d 174

688 N.Y.S.2d 23

CITY OF NEW YORK et al., Appellants,

v.CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 1.)

CITY OF NEW YORK et al., Appellants,

v.CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 2.)

CITY OF NEW YORK, Appellant,

v.CHARLES PFIZER & COMPANY, INC., Respondent, et al., Defendants. (Action No. 3.)

Decided April 6, 1999.

Concur — Sullivan, J. P., Tom, Lerner and Rubin, JJ.

In these actions, plaintiffs seek to recover the costs of abating asbestos-containing materials from their buildings. Defendant Pfizer is sued solely based on the installation in certain of plaintiffs' buildings prior to 1955 of the asbestos-containing lime-based acoustical plaster Kilnoise, which was manufactured and sold by the now defunct Kelley Island Lime and Transport Company, subsequently (after merger with another entity) known as Kelley Island Company (collectively, Kelley Island). In 1955, Basic Refractories, Incorporated, now known as Basic Incorporated (Basic), purchased all of Kelley Island's assets (except for the stock of a wholly-owned subsidiary not here pertinent) and Kelley Island was dissolved. In 1957, Basic incorporated a wholly-owned subsidiary, Tiger Brands, Inc. (Tiger Brands) to conduct its building materials businesses, including the Kilnoise product line, among other lime-based products. In 1962, Basic sold its lime product business to Gibsonburg Lime Products Corporation (Gibsonburg), which in 1964 sold all of its assets to Pfizer and dissolved. Pfizer continued to manufacture and sell Kilnoise until it discontinued the product in 1972.

We agree with the IAS Court that Gibsonburg, Pfizer's predecessor-in-interest, did not, by reason of the provision in its contract to purchase Basic's lime products business that Basic would indemnify it against claims arising "with respect to any hydrated lime products sold by Basic prior to the Closing Date", impliedly assume the liabilities of Basic's predecessor-in-interest in the lime products business, Kelley Island. Had the parties intended that Gibsonburg assume such liabilities, they would have expressly so provided in their agreement.

We also agree with the IAS Court that Gibsonburg did not succeed to the liabilities of Kelley Island by virtue of any de facto merger, inasmuch as Basic, which had succeeded to Kelley Island's liabilities through the 1955 transaction, cannot be deemed to have been "merged" into Gibsonburg. Basic sold Gibsonburg only a small part of its business, continues to do ...