Westchester County v. Welton Becket Associates
| Decision Date | 29 May 1984 |
| Docket Number | No. 1,No. 4,No. 3,No. 2,1,2,3,4 |
| Citation | 102 A.D.2d 34,478 N.Y.S.2d 305 |
| Parties | The COUNTY OF WESTCHESTER, Appellant, v. WELTON BECKET ASSOCIATES, et al. Appellants, et al., Defendants (and third and fourth-party actions). ActionJ.R. STEVENSON CORP., Respondent, v. The COUNTY OF WESTCHESTER, Appellant, et al., Defendants (and third, fourth, fifth and sixth-party actions). ActionMARTIN MECHANICAL CORPORATION, Respondent, v. The COUNTY OF WESTCHESTER, Appellant, et al., Defendant (and third and fourth-party actions). ActionLUNA INDUSTRIES, INC. (LUNA ELECTRIC COMPANY DIVISION), Respondent, v. The COUNTY OF WESTCHESTER, Appellant, et al., Defendant (and third and fourth-party actions). Action |
| Court | New York Supreme Court — Appellate Division |
Carter, Ledyard & Milburn, New York City (Robert N. Fass of counsel), for appellants Welton Becket Associates, Welton Becket & Associates, MacDonald Becket, Wayman C. Wing, Cosentini Associates and Eitingon & Schlossberg Associates.
Henry J. Logan, County Atty., White Plains, for appellant County of Westchester (one brief filed).
Max E. Greenberg, Cantor & Reiss, New York City (Julius L. Schapira, David A. Trager and Kalvin Kamien, New York City, of counsel), for respondents J.R. Stevenson Corp., Employers Commercial Union Ins. Co. of America, American Employees Ins. Co., The Employers Fire Ins. Co. and the Northern Assur. Co. of America.
Ross & Cohen, New York City (Lawrence E. Laykam and Ira M. Schulman, New York City, of counsel), for respondent Luna Industries, Inc. (Luna Elec. Co. Div.).
Gottesman, Wolgel, Smith & Seconda, P.C., New York City (Harold H. Wolgel and Michael H. Goldstein, New York City, of counsel), for respondent Home Indem. Co.
Quirk and Bakalor, P.C., New York City (Stephen K. Blunda, New York City, of counsel), for respondents E.M. Fitzsimons & Associates, Inc., E.M. Fitzsimons & Associates Before LAZER, J.P., and MANGANO, THOMPSON and BRACKEN, JJ.
Inc., and Giamboi Bros., Inc., a joint venture, and Giamboi Bros., Inc.
In this complex litigation arising out of the construction of the Westchester County Courthouse in White Plains, New York, this court must address three separate issues. Subdivision (b) of section 15-108 of the General Obligations Law provides that a release given in good faith by an injured person to one wrongdoer relieves that wrongdoer from liability to any other person for contribution as provided for in CPLR article 14. We must decide in this case if nonsettling parties seeking contribution under CPLR article 14 from settling parties have sufficiently alleged causes of action for indemnification against the latter so as to allow the nonsettling parties to keep the settling parties in the litigation. We must also decide if allowing a discontinuance with prejudice of the actions among the settling parties and a dismissal of all claims among them will unfairly prejudice or impair the rights of other entities which will remain parties to the litigation. Finally, we must address the question of whether a plaintiff seeking to assert a fraud claim against certain settling parties has sufficiently alleged a cause of action against those parties in light of the absence of a direct relationship between them.
In 1968 the County of Westchester entered into a contract with Welton Becket F.A.I.A., to design a new courthouse. This contract was subsequently assigned to and assumed by Welton Becket Associates and Welton Becket & Associates (hereinafter collectively Becket). Becket retained Cosentini Associates and Wayman C. Wing as consulting engineers, and Cosentini Associates retained Eitingon & Schlossberg Associates as its consulting engineer.
In 1970 contracts were awarded by the county to three prime contractors. J.R. Stevenson Corp. became the general contractor, Luna Industries, Inc. became the electrical contractor and Martin Mechanical Corporation became the mechanical contractor. J.R. Stevenson Corp. retained Belt Painting Corp., Cafasso Lathing & Plastering Co., Inc., and the joint venture of Giamboi Bros. Inc. and E.M. Fitzsimons & Associates, Inc. as subcontractors. For purposes of these appeals the four distinct groups involved in the litigation shall hereinafter be referred to as follows:
1. The County of Westchester (the county)
2. Welton Becket )
Welton Becket Associates ) (Becket) )
Welton Becket & Associates ) )
MacDonald Becket (MacDonald) ) (the design
professionals)
Wayman Wing (Wing) )
Cosentini Associates (Cosentini) )
Eitingon & Schlossberg Associates (Eitington) )
3. J.R. Stevenson Corp. (Stevenson) )
Luna Industries, Inc. (Luna) ) (the
contractors)
Martin Mechanical Corporation (Martin) )
4. Belt Painting Corp. (Belt) )
Cafasso Lathing & Plastering Co., (Cafasso) )
Inc
Giamboi Bros., Inc. (Giamboi) ) (the subcontractors)
E.M. Fitzsimons & Associates, Inc. (Fitzsimons) )
The joint venture of Giamboi Bros
Inc
and E.M. Fitzsimons & Associates, (the joint
Inc. venturers)
THE LITIGATION
On April 29, 1970 the contractors were advised to proceed with the construction, and although they were supposed to complete their work within 975 days, it has been alleged that the courthouse was not ready for full occupancy until April 29, 1975. Problems with regard to defective workmanship also arose. As a result, four separate lawsuits ensued. In three of In Action No. 1 the county sued the design professionals (except Eitingon, which was subsequently impleaded by Cosentini) for negligence and breach of contract based on design defects which had existed. The design professionals asserted cross claims among themselves for contribution and indemnification, and also impleaded certain of the contractors and subcontractors for contribution and indemnification. 1
those actions the contractors sued the county to recover damages, inter alia, for delay caused by the county and for the value of extra work performed. The county counterclaimed against the contractors and their sureties to recover damages based on the delay in completing the courthouse and for defective workmanship. In each of those three actions the county also brought a third-party action against certain of the design professionals and others for contribution and indemnification. The design professionals asserted cross claims among themselves. Fourth-party actions were started, and in Action No. 2 Stevenson and its sureties initiated fifth and sixth-party actions for contribution and indemnification against, inter alia, the subcontractors and Home Indemnity Company (Home), which had bonded two of the contractors. Certain subcontractors and Home in turn asserted cross claims against certain of the design professionals and others for contribution and indemnification.
NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE
In December, 1982 the county reached a settlement with the design professionals in all the actions. Stipulations of discontinuance and releases were executed. The county and the design professionals then sought an order directing entry of judgment dismissing Action No. 1 against the design professionals. They also sought an order directing entry of judgment dismissing all claims, including cross claims, counterclaims, and third and fourth-party claims, which had been brought against the design professionals in Actions 2, 3 and 4. The design professionals also sought summary judgment dismissing the claims brought against them for contribution and indemnification by the fifth and " § 15-108. Release or covenant not to sue
sixth-party defendants (the subcontractors and Home). The design professionals believed they were entitled to remove themselves from the litigation by reason of section 15-108 of the General Obligations Law which provides, in pertinent part:
The design professionals reasoned that having settled with the injured party and being immune from contribution claims by the contractors and subcontractors pursuant to section 15-108 of the General Obligations Law, they were entitled to remove themselves from the litigation as parties. They further argued that no cause of action for indemnity had been stated against them.
In opposition to the motion, Stevenson, Home, and several subcontractors argued that the nature of their claims against the design professionals was for indemnification as...
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