Gannon Personnel Agency, Inc. v. City of New York

• Decision Date: 26 September 1979
• Citation: 425 N.Y.S.2d 446,103 Misc.2d 60
• Parties: GANNON PERSONNEL AGENCY, INC., Plaintiff, v. The CITY OF NEW YORK et al., Defendants, and 42 other actions.
• Court: New York Supreme Court

Page 446

425 N.Y.S.2d 446

103 Misc.2d 60

GANNON PERSONNEL AGENCY, INC., Plaintiff, v. The CITY OF NEW YORK et al., Defendants, and 42 other actions.

Supreme Court, Trial Term, New York County, Part 22.

Sept. 26, 1979.

Robert L. Conason, New York City, for the personal injury plaintiffs.

Martin Kagan, New York City, for the property damage plaintiffs.

William J. Walls, New York City, for defendant City of New York.

Francis M. Leonard, New York City, for defendant Con. Ed.

Robert L. Horkitz, New York City, for defendants Schlink and Bold.

EDWARD J. GREENFIELD, Justice:

On December 11, 1970, at 2 p. m., a tremendous gas explosion ripped apart the three story commercial building at 7-11 Ann Street, running through to Park Row, across from City Hall in lower Manhattan. The building blazed fiercely, and within minutes the remaining walls, ceilings and floors had collapsed. Many people were on the premises at the time, in the stores, shops, bar and restaurant. Twelve people were killed in the explosion, scores injured, and the businesses conducted on the premises were wiped out.

Forty-three separate actions were commenced as a result, against various defendants, and they were all consolidated for trial on the issue of liability. The matter was tried in 1974 by Mr. Justice Spiegel and a jury, resulting in a verdict on liability against Schlink and Bold, the plumbers who had installed a new gas piping system for the restaurant, the City of New York and the Consolidated Edison Company. Complaints were dismissed as to other named defendants, except China Dynasty Enterprises, Inc., which had operated a restaurant on the premises, and which had defaulted. The liability was apportioned 65% for the City of New York, 10% for Consolidated Edison, 121/2% for Schlink and 121/2% for Bold.

On appeal, the Appellate Division, concluding the court's charge to the jury had been erroneous, modified the judgment to the extent of directing a new trial on the issue of the liability of the City of New York, affirmed as to the liability of the other defendants, and directed a new apportionment of damages as to all defendants liable, including the defaulting defendant China Dynasty Enterprises, Inc. Gannon Personnel Agency, Inc. v. City of New York, et al., 57 A.D.2d 538, 393 N.Y.S.2d 915 (1977).

On the second trial, tried before me with a jury, the jury again found liability on the part of the City of New York, and having heard all the evidence, apportioned liability 80% against China Dynasty, 11% against Schlink, 1% against Bold, 4% against Consolidated Edison and 4% against the City of New York. The City of New York has moved to set aside the jury's verdict finding it liable and fixing its responsibility at 4%; the plumbers Schlink and Bold moved to set the verdict aside insofar as it allocates 11% and 1% of the responsibility to them. The court denied the latter motion from the bench, but has reserved decision until now on the city's motion.

Although the responsibility of the city and of Consolidated Edison has been fixed at 4% each, in actuality they are being called upon to bear the brunt of whatever damages are ultimately assessed, because the principal, tortfeasor, China Dynasty, is defunct, uninsured, and almost certainly unable to respond even in part to any judgment. The plumbers, Schlink and Bold, have a limited amount of liability coverage and no substantial assets of their own. That means, since each tortfeasor is fully liable to the plaintiffs despite apportionment inter se that of the potential damages which can run into many millions of dollars, the apportionment fixed by the jury, if it stands, will really result in the city and Consolidated Edison, as joint tortfeasors, paying virtually 50% each of the final judgments.

The basic contention of the city on this motion to set aside the jury's verdict as to it, is that a municipality cannot be held liable for failure to enforce a statute or regulation, absent some special relationship to those claiming to be injured by its alleged dereliction of duty, relying on Motyka v. City of New York, 15 N.Y.2d 134, 139, 256 N.Y.S.2d 595, 597, 204 N.E.2d 635, 636. Obviously, with laws, codes and regulations on the books enough to stuff a good sized library, a municipality is not to be held liable every time one of its many inhabitants claims that had the law been properly enforced, the injury would not have occurred. Certainly, a municipality is not to be held liable if a crime is committed against a person which could have been prevented had a policeman been on the scene. It cannot be an insurer which is answerable every time a health or safety regulation has not been complied with, and injury ensues. But a municipality is not absolved of all responsibility whenever a wrong has been committed by another. The inquiry in this case must be into the nature of the special relationship and the unique duty which will, in fact, cast a municipality in liability. What was it which caused this catastrophic gas explosion, and led two juries to conclude that the city was responsible as a joint tortfeasor?

The building at 7-11 Ann Street, also facing on Park Row, had been erected as a one-story motion picture theater in 1913. In 1921, it was expanded to three stories, and eventually the theater was replaced by stores and an upstairs billiard parlor. In 1969, application was made to convert the second and third floors to a restaurant. Its cooking needs necessitated expanded gas service to the building, for which plans were filed and an application duly made. The old 11/2 gas line servicing the building from the street main was to be discontinued and a new 3 service line installed. Consolidated Edison sent a service representative to the premises to check field conditions, and it supplied the plumber working for China Dynasty on the renovations for the restaurant with a schematic diagram of the gas piping to be installed from the incoming service pipe to the meters. The City's Department of Buildings approved the plans. The city issued a permit to dig up the street to expose the gas main, and between November 16-18, 1970 the main was tapped for a 3 line into the building until turned on by a special key or wrench. The service pipe into the building, which branched into a T-shape inside, was also fitted with metal caps so that no gas could flow through until all the piping had been hooked up.

The Schlink Plumbing and Heating Co. Inc. was doing the work of connecting the gas pipe installation in the building. Its officers were Otto Schlink and Albert Bold. Schlink, though a plumber for 20 years and licensed in Nassau County, was not a licensed plumber in New York City. Bold was. He authorized Schlink to file applications to do plumbing work, he never once came to the premises. Schlink, working with a helper, had no experience in hooking up a new service line to meters, and had no recollection of having worked with Consolidated Edison before. In connecting the incoming service pipe to the meters, and thence to the individual tenants in the building, Schlink made two major and disastrous omissions:

(1) He failed to install a shut-off valve where the service pipe entered the building, so that the flow of gas to the entire building could be controlled from one single location inside the premises.

(2) He left a gas pipe, or leader, running to the next basement room, open ended and uncapped.

In addition, there may or may not have been a gap between pipes where the new meter for the restaurant was to be installed to measure the gas flowing through. The new meter was not on hand, and Consolidated Edison agreed there could be a temporary connecting link-up there for a day or two until the meter arrived and could be installed.

Thus, unless corrective action was taken, the stage was set for disaster. Once gas was allowed to flow from the street main to the building it would inevitably leak out from any open-ended pipe, and there was no in-house shut-off valve to cut the gas off once leakage was observed. But before the gas could be allowed to flow, both the city and Consolidated Edison would have had to check out the hook-up.

The city inspector for the job was one Hyman Gould. He arrived on the premises on December 2, 1970 for final inspection of the new gas pipe installation. Although he claims he made a proper inspection, he claimed he was never made aware that this was a new incoming gas service line, and that his inspection was limited only to the piping from the meter to the restaurant. There was evidence which the jury obviously chose to believe on the basis of their finding liability on the city's part, either that he did not see or inspect what he should have, or that he saw it and despite the open-ended piping and the absence of a shut-off valve at the building's point of intake, he told Schlink, "Good job", and indicated the necessary blue card signifying official approval would issue. The blue card reads as follows:

"This is to certify that the gas pipes of the premises known as No. 7 to 11 Ann Street in the Borough of Manhattan conforms to the rules and regulations of this department in effect at this date."

Clearly the gas piping installation which the city inspector approved did not comply with the rules and regulations. One of the provisions of the Administrative Code required a shut-off valve at the head of the service, i. e. at a point within two feet of the point of entry of a gas service line into the building. (Administrative Code, RS 16, P115.2, subd. (a).) There was in fact no such shut-off valve. And Section C26-1606.1 of the Code required every part of a new or altered gas piping system to be inspected and tested to determine compliance with Code requirements. Yet despite a mercury test he administered the city inspector failed to ascertain the existence of open-ended gas piping. Had the piping system leaked, the mercury test could have uncovered that fact. But...