Lindner v. Kew Realty Co.

• Decision Date: 21 October 1985
• Citation: 113 A.D.2d 36,494 N.Y.S.2d 870
• Court: New York Supreme Court — Appellate Division
• Parties: George LINDNER, et al., Plaintiffs-Respondents, v. KEW REALTY CO., a partnership, et al., Defendants Third-Party Plaintiffs-Appellants; F.W. Koehler & Sons, Inc., Third-Party Defendant and Fourth-Party Plaintiff Appellant, et al., Fourth-Party Defendant.

Page 870

494 N.Y.S.2d 870

113 A.D.2d 36

George LINDNER, et al., Plaintiffs-Respondents, v. KEW REALTY CO., a partnership, et al., Defendants Third-Party Plaintiffs-Appellants F.W. Koehler & Sons, Inc., Third-Party Defendant and Fourth-Party Plaintiff Appellant, et al. Fourth-Party Defendant.

Supreme Court, Appellate Division Second Department.

Oct. 21, 1985.

Rivkin, Leff, Sherman & Radler, Garden City (Frank L. Amoroso and David P. Franks, of counsel), for defendants third-party plaintiffs-appellants.

Courtney & Courtney, Forest Hills (William J. Courtney, of counsel), for plaintiffs-respondents.

Before GIBBONS, J.P., and O'CONNOR, NIEHOFF and LAWRENCE, JJ.

GIBBONS, Justice Presiding.

We are called upon on this appeal to review the propriety of Special Term's denial of a cross motion by the defendants-third-party-plaintiffs (hereinafter the defendants) to amend their answer to include the affirmative defense of workers' compensation, and for dismissal of the amended complaint on that ground. Workers' Compensation Law § 29(6) pertinently provides that "[t]he right to compensation or benefits under this chapter, shall be the exclusive remedy to an employee * * * when such employee is injured * * * by the negligence or wrong of another in the same employ". The primary question to be determined herein is whether defendants, the partnership owner of the premises under construction and its individual partners, are protected by this provision against the liability imposed upon owners by Labor Law §§ 240 and 241 by virtue of the fact that one of the partners, Frederick W. Koehler, Jr., is also the president of the injured plaintiff's corporate employer. It is our determination that, under the circumstances of this case, only Frederick W. Koehler, Jr., the "co-employee" of plaintiff, was immune from liability under the Workers' Compensation Law, and entitled to summary judgment. The remaining defendants are not "in the same employ" as the injured plaintiff, and Special Term was therefore correct in denying so much of the cross motion which was to amend their answer to assert the affirmative defense of workers' compensation.

On March 30, 1979, plaintiff George Lindner (hereinafter the plaintiff) was injured in a fall from a broken scaffold during the course of his employment by F.W. Koehler and Sons, Inc. (hereinafter FWK) in the construction of a building owned by Kew Realty Co. (hereinafter Kew Realty). He was awarded workers' compensation benefits on November 8, 1979. In 1980 Lindner and his wife commenced the instant personal injury action against Kew Realty predicated on the latter's breach of the statutory duty imposed upon owners by Labor Law §§ 240 and 241 to ensure that the scaffolding employed at a worksite is properly constructed. On or about July 1, 1980, Kew Realty commenced a third-party action against plaintiff's employer (FWK), seeking indemnification on the ground, inter alia, the FWK had entered into an agreement with Kew Realty to act as general contractor on the project. At an examination before trial conducted on October 27, 1980, the plaintiffs apparently learned for the first time that Kew Realty was a partnership consisting of three equal partners and, by leave of court, served a supplemental summons and amended complaint, dated February 10, 1981, naming "Kew Realty Co. a partnership, Frederick W. Koehler, Jr., Eugene Koehler and William Tyree" as defendants. It is not disputed that proper service was made upon the partnership, and that the individual partners Frederick W. Koehler, Jr., and William Tyree were personally served. Apparently, however, Eugene Koehler had died before leave was obtained to serve a supplemental summons and amended complaint, and therefore he was never served with process in this action. Thereafter the defendants Kew Realty, Frederick W. Koehler, Jr. and William Tyree undertook to serve an amended third-party complaint upon FWK, dated June 16, 1981, which differed in substance from the original pleading only insofar as it asserted that FWK had entered into an agreement to perform services with regard to the construction of the subject building, but did not contend that the agreement had been made with Kew Realty. FWK subsequently counterclaimed against Kew Realty for indemnification and/or contribution, and on or about March 10, 1983, served a fourth-party complaint upon Dominion Construction Co. (hereinafter Dominion), alleging that the latter, and not FWK, was the general contractor.

In April of 1983, plaintiffs apparently moved for summary judgment against the defendants, whereupon the latter cross-moved for summary judgment against the third-party defendant FWK. In support of their cross motion, the defendants submitted affidavits by the two surviving partners, Frederick W. Koehler, Jr., and William Tyree, in which it was stated, inter alia, that:

"4. Kew Realty Co. had no persons or employees involved in any way with the construction or erection of [the] building. All work was done by Dominion Construction Co. and its contractors. Kew Realty exercised no direction, supervision or control of any kind at the work site. All work including the safety at the site was delegated to Dominion Construction Co. and its contractors.

"5. One of the contractors was F.W. Koehler & Sons, Inc., the third-party defendant. F.W. Koehler & Sons, Inc. was to do, and did, the masonry work on the building".

By order dated April 29, 1983 (McCarthy, J.), the motion and cross motion were both denied, based on Special Term's conclusion that there existed triable issues of fact, regarding whether the scaffold in question was defectively constructed and whether the alleged defect had, in fact, caused plaintiff's fall. Defendants thereafter served a second third-party complaint upon Dominion. At no time prior to August 1983 did any of the defendants or the third-party defendant assert the defense of workers' compensation, nor was it pleaded that there was any relationship whatsoever between Kew Realty Co., FWK and/or Dominion. Trial was scheduled for September 15, 1983.

On July 7, 1983, the Court of Appeals affirmed the decision of the Appellate Division, Third Department, in Heritage v. Van Patten, 90 A.D.2d 936, 457 N.Y.S.2d 912, affd. 59 N.Y.2d 1017, 466 N.Y.S.2d 958, 453 N.E.2d 1247, holding that a landowner who was also the president and sole shareholder of plaintiff's employer was, for purposes of workers' compensation, a coemployee, and, hence immune from the liability imposed by Labor Law § 241 for injuries sustained during the course of plaintiff's employment (Workers' Compensation Law § 29[6] ). Subsequently, by notice of motion dated August 25, 1983, FWK, the third-party defendant, sought dismissal of the main complaint on the ground that it failed to state a cause of action (CPLR 3211[a][7] ), and submitted in support thereof an affidavit by Frederick W. Koehler, Jr., in which it was stated, inter alia, that at all times relevant to this action he was a partner in Kew Realty, as well as the president of both the general contractor Dominion, and plaintiff's employer FWK, the masonry subcontractor. Accordingly, it was argued by the movant that under the Workers' Compensation Law, as construed by the Court of Appeals in Heritage v. Van Patten (supra), plaintiff could not maintain the present action against Kew Realty because of the coemployee status of one of the partners, Frederick W. Koehler, Jr., in his capacity as the president of FWK. Thereafter, by notice of cross motion dated August 31, 1983, the defendants sought leave to amend their answer to assert the affirmative defense of Workers' Compensation (Workers' Compensation Law § 29[6] ) and moved for dismissal of the complaint on that ground. Incorporating the exhibits which were annexed to the third-party defendant's motion, counsel for the defendants argued that an amendment of an answer to assert the affirmative defense of workers' compensation could be made at any time during the action and that based upon the undisputed facts, plaintiffs' personal injury action is barred by the exclusive remedy provision of the Workers' Compensation Law (Workers' Compensation Law § 29[6] ).

Plaintiffs' opposition to the motion and cross motion rested on two principal grounds. First, it was contended that the inconsistencies in defendants' factual allegations had prejudiced the plaintiffs and rendered the granting of summary judgment dismissing the complaint inappropriate. Specifically, plaintiffs pointed to the fact that defendants Frederick W. Koehler, Jr., and William Tyree had initially stated that Kew Realty had no persons or employees involved in the direction, control, or supervision of the worksite, but that Frederick W. Koehler, Jr., had not admitted to being the president of plaintiff's employer, FWK. Moreover, defendants had initially represented that FWK was the general contractor, but now, after the Statute of Limitations had run, belatedly asserted that Dominion rather than FWK was the general contractor on the project. Second, plaintiffs' attorney argued that the Heritage decision was not controlling in that (1) the defendant in Heritage had specifically pleaded the affirmative defense, while, at bar, the defendants denied the existence of any employment relationship with the plaintiff, and (2) the ownership of the premises in Heritage lay solely with the employer's principal, in his individual capacity, while, at bar, the ownership resides in a partnership, and only one of the partners claims to be a coemployee of the plaintiff. In a reply affirmation, counsel for the defendants asserted, inter alia, that it was not inaccurate for Koehler and Tyree to have stated that Kew Realty had no persons involved in the building's construction, because Frederick W. Koehler, Jr., was not involved in his capacity as a partner. In further support of their motion and cross motion, counsel for FWK and the counsel for Kew...