New York State Court of Claims

New York State Court of Claims

REYNOLDS v. THE STATE OF NEW YORK, #2001-028-0537, Claim No. 101868, Motion Nos. M-62810, CM-63045


Synopsis


An action based on Labor Law §§ 200, 240 and 241, arising from injury to a construction employee working on a New York State Thruway bridge, is dismissed on the ground that only the State of New York was sued and the State is not an "owner" of Thruway property for the purposes of the workplace safety statutes.

Case Information

UID:
2001-028-0537
Claimant(s):
TRISTA REYNOLDS
Claimant short name:
REYNOLDS
Footnote (claimant name) :
Defendant(s):
THE STATE OF NEW YORK
Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
101868
Motion number(s):
M-62810
Cross-motion number(s):
CM-63045
Judge:
RICHARD E. SISE
Claimant's attorney:
ALEXANDER & CATALANO, LLPBY: PETER CATALANO, ESQ.
Defendant's attorney:
LAW OFFICES OF F. DOUGLAS NOVOTNYBY: F. Douglas Novotny, Esq.
Third-party defendant's attorney:

Signature date:
June 7, 2001
City:
Albany
Comments:

Official citation:

Appellate results:

See also (multicaptioned case)



Decision

The following papers were read on the parties cross motions for summary judgment:

1. Notice of Motion, filed on December 6, 2000.

2. Affirmation of Peter Catalano, Esq. filed December 6, 2000 with annexed Exhibits A-G (Catalano Affirmation)

3. Affidavit of Trista Reynolds, filed December 6, 2000 (Reynolds Affidavit)


4. Notice of Cross-Motion filed February 5, 2001


5. Affirmation of F. Douglas Novotny, Esq. filed February 5, 2001 (Novotny Affirmation) with annexed Exhibits A-C.


6. Reply Affirmation of Peter Catalano, Esq. filed February 13, 2001 (Catalano Reply)

7. Filed papers: Claim, filed January 31, 2000. Verified Answer.


This claim arose on November 7, 1999, when claimant Trista Reynolds fell while working on a bridge that carries the New York State Thruway over the Catskill Creek in Greene County, New York. The project on which claimant was working – "Painting the Thruway bridge over the Catskill Creek" – was the subject of a contract between the New York State Thruway Authority ("the Authority") and Liberty Maintenance Company, Inc. ("Liberty") (Catalano Affirmation, ¶ 6; Exhibit E). This contract contains no reference to the State of New York. All submissions currently before the Court indicate that, at the time she was injured, claimant was employed by either Liberty or E & D[1] and was performing work called for under the contract noted above.

The claim sets forth causes of action based on Labor Law §§200, 240 and 241. Despite its affirmative defense that claimant's injuries were caused by or contributed to by a third party and having denied having knowledge and/or information sufficient to form a belief as to the truth of Claimant's allegation that "the State of New York., Liberty Maintenance Inc. and/or E & D were parties to a contract concerning...a bridge...owned, operated and/or maintained by the State of New York" (Claim ¶ 5) Defendant focused its motion for summary judgment elsewhere. Claimant did not address the ownership issue, despite attaching to its moving papers the "New York State Thruway Authority Department of Engineering and Maintenance Itemized Proposal for Painting the Thruway Bridge...in the Albany Division of the New York State Thruway...Which Constitutes Contract No. TAA 99-17BP" (Catalano Affirmation, Exhibit E). However, these cross-motions necessarily raise the issue of whether the State of New York can be considered an "owner" of Thruway Authority property for the purposes of the Labor Law workplace safety statutes.

With all of the construction and reconstruction work that has been performed on the New York State Thruway over the years, and with the number of workplace safety claims that inevitably arose from such work, one would think that this question would have been settled long ago. In most instances, however, it appears that there has simply been no need, because the Thruway Authority itself is certainly an "owner" under the statutes, and thus claims can simply be brought against the Authority, without needing to involve the State[2] (see, Scorza v New York State Thruway Auth., 274 AD2d 463; Van Alstyne v New York State Thruway Auth., 244 AD2d 978; Karagiannis v New York State Thruway Auth., 187 AD2d 1009; DeMilio v New York State Thruway Auth., 15 AD2d 27; Barnes v New York State Thruway Auth., 176 Misc 2d 195; Martino v New York State Thruway Auth., 154 Misc 2d 905).[3] Research has disclosed only one Court of Appeals decision involving a Labor Law claim that arose from work on the Thruway, Ares v State of New York (80 NY2d 959). Unhelpfully, in that action both the State and the Authority were named as defendants, and counsel for both entities made appearances on the appeal.

In the instant claim, however, the issue is critical. The State of New York is the only defendant to be named in the claim (or in any other pleading filed in this action) and the affidavit of service attached to the claim shows that it was served only on the Attorney General.

CPLR 1001 and 1003 afford the courts wide latitude in the addition or deletion of parties (see, Schmidt v. Schmidt, 99 AD2d 775). In this regard, the court may on its own motion and at any stage of the litigation determine that there is a nonjoinder of necessary parties (see, Matter of Lezette v. Board of Educ. Hudson City School Dist., 35 NY2d 272, 282; Solomon v Solomon, 136 AD2D 697,698; Schmidt v. Schmidt, supra.) It is also within the Court's discretion to dismiss a proceeding sua sponte for the failure to join that necessary party (see, CPLR 1003; Matter of Dyno v Rose, 260 AD2d 694, appeal dismissed 93 NY2d 998, lv denied 94 NY2d 753; see also, CPLR 1001 [b]; City of New York v Long Is. Airports Limousine Serv. Corp., 48 NY2d 469, 475; Matter of Manupella v Troy City Zoning Bd. Of Appeals, 272 AD2D 761, 763). Accordingly, the Court will, sua sponte, resolve this critical threshold issue.

New York State Thruway Authority

The New York State Thruway Authority is a public benefit corporation created by a special act of the Legislature (L.1950, ch. 143) and is responsible for construction and maintenance of the New York State Thruway (see, Public Authorities Law § 352). It is "independent and autonomous, deliberately designed to be able to function with a freedom and flexibility not permitted to an ordinary State board, department or commission" (Matter of Plumbing, Heating, Piping and Air Conditioning Contractors Assn, Inc. v New York State Thruway Authority, 5 NY2d 420, 423). The Authority is solely liable for its negligence in the performance of its usual functions, including the maintenance and operation of the Thruway

(Cottingham v State of New York, 182 Misc 2d 928, n 1; Mickle v New York State Thruway Auth., 182 Misc 2d 967).

Exclusive jurisdiction to hear tort and contract claims against the Authority is vested in the Court of Claims, but it nevertheless remains a separate and distinct entity from the State. While "in the lay mind the Thruway is regarded as being owned and operated by the State of New York," the Authority, in fact, has been given "a distinct legal status" and suit against one is not the same as suit against the other (Tomlinson Construction Co. v State of New York, 30 Misc 2d 1010, 1011, affd 16 AD2d 1032, appeal den 12 NY2d 642). Consequently, in order to obtain jurisdiction over the Thruway Authority, both the Authority and the Office of the Attorney General must be served with a claim (or notice of intention to file a claim); service on the Attorney General alone, which is all that is required to initiate a claim against the State, is not sufficient to commence an action against the Authority (Court of Claims Act §11[a][ii]; Finnerty v New York State Thruway Authority, 75 NY2d 721; Bonaventure v New York State Thruway Authority, 108 AD2d 1002).[4]

Real property, easements and improvements that are under the Thruway Authority's jurisdiction are held by the Authority "in the name of" the State. Public Authorities Law §354(4) authorizes the Authority to "acquire and hold in the name of the state by purchase or appropriation" the real property or easements needed to carry out its corporate purposes;[5] sections 358 and 358-a authorize the Authority or its Commissioner to acquire additional property "in the name of the state" by appropriation, condemnation or deed; and the Authority is also given the power to dispose of any real property not necessary for its purposes. Public Authorities Law § 357 authorizes the Authority to "assum[e] jurisdiction" of nine specifically-described highway sections, and, with respect to those sections, to possess and use "any real property and rights in real property theretofore acquired by the state" (emphasis supplied).

It is difficult to describe what, if any, ownership interest the State retains in property that is acquired and held "in its name" by another entity. The Court must analyze whether that interest is a sufficient connection for the State to be deemed an "owner" of the property for purposes of the Labor Law, or whether the State's lack of control over work projects on the property precludes it from being an owner.

"Owner," as used in the Labor Law workplace safety statutes

With certain exceptions not relevant here, the workplace safety statutes contained in Article 10 of the Labor Law impose liability on "all contractors and owners and their agents." The term "owner" is not defined in the statute, and, with respect to the liability of those who have ownership interest in property but do not request or control work that is performed on it, "[c]ase law presents what at first blush appear to be contradictory answers with regard to an owner's liability for work requested by others" (Otero v Cablevision of N. Y., 186 Misc 2d 651).

The first answer, or approach, is articulated most fully in two Court of Appeals decisions: Gordon v Eastern Railway Supply, Inc. (82 NY2d 555) and Celestine v City of New York (59 NY2d 938, affd 86 AD2d 592). These decisions, and their progeny, emphasize that "liability rests upon the fact of ownership" and consider the question of whether the owner contracted for or controlled the work project, or benefitted from the work being performed, to be "legally irrelevant" (Gordon, supra, at 560; see also, Haimes v New York Telephone Co., 46 NY2d 132). The second answer, or approach, focuses on whether the party has control of the property, or of the work project, or benefits from the work being performed. Under this view, it is not necessary for the party to actually become involved in contracting for the work and establishing work conditions: "[I]t is the right to control the work that is significant, not the actual exercise or nonexercise of control" (Copertino v Ward, 100 AD2d 565, 567 [emphasis supplied]; accord, Marks v Morehouse, 222 AD2d 785, 786; Nowak v Smith & Mahoney, 110 AD2d 288). Under this view, a party that does not have the right to control or set conditions for the work cannot be held liable (Santos v American Museum of Natural History, 187 AD2d 420; Nowak v Smith & Mahoney, 110 AD2d 288, 290, supra).

Although some courts have treated these two approaches as mutually exclusive, in this Court's view they can be reconciled, and each approach validated, by considering the dual purposes behind the 1969 revision of the Labor Law workplace safety provisions. In an earlier version of the statutes, liability was placed on "person[s] employing or directing another to perform labor of any sort." The 1969 amendment (L 1969, ch 1108) targeted a more inclusive group, one defined by status rather than activity: "all contractors and owners" (see, Haimes v New York Telephone Co., 46 NY2d 132, supra). The two primary purposes of the statutes, and of this amendment in particular, are "to maintain safe working conditions and [to] insure financial responsibility for any losses suffered" (Nowak v Smith & Mahoney, P.C., 110 AD2d 288, 290, supra, citing to 1969 NY Legis Ann, at 407).

To help bring about safe working conditions, the parties subjected to liability must be those in a position to influence those conditions or, in other words, those that have control over the property and/or over the work being performed so that they can enforce safety standards and choose responsible contractors to perform the work (Clute v Ellis Hospital, 184 AD2d 942; see also, Perez v Paramount Communictions, Inc., 247 AD2d 264, affd 92 NY2d 749; Nowak v Smith & Mahoney, P.C., 110 AD2d 288, 290, supra; Sweeting v Board of Cooperative Educational Services, 83 AD2d 103, 113, appeal den 56 NY2d 503, citing to NY Legis. Ann., 1969, pp 407-408.). The second goal, insuring financial responsibility for injuries to workers, favors imposition of liability on presumptively solvent owners, even if they have no direct control over a work project. "It may well have been the intention of the Legislature to impose the unconditional obligation upon the owner of the fee as a party likely to have the financial responsibility to respond to a judgment in favor of the injured worker" (Kerr v Rochester Gas and Electric Corp., 113 AD2d 412, 416). Rather than being mutually exclusive, therefore, the two approaches complement and supplement one another, and both are needed to properly effect the purposes of these Labor Law statutes. Consequently, in the instant claim, even though the State of New York had no control over the property or over the project on which claimant was working, liability may nevertheless be imposed if its retained ownership rights are sufficient to warrant application of the Celestine/Gordon standard.

Limits on the Liability of Owners

In most instances, when liability has been imposed on parties who have no control over or benefit from the work project, the persons or entities hold fee title or possess some other traditionally-recognized ownership rights (Haimes v New York Telephone Co., 46 NY2d 132, supra; Marks v Morehouse, 222 AD2d 785, supra; Phillips v Eastman Kodak Co., 204 AD2d 979). It has been suggested that this is justified because, no matter how much control has passed to the hands of others, these owners at some point had the ability to influence the manner in which work would be performed on their property and, thus, worker safety. "[I]t is within the control of the fee owner, when he conveys a leasehold or other partial interest in the property, to select responsible grantees and to impose conditions in the conveyance concerning construction upon the premises" (Kerr v Rochester Gas and Electric Corp., 113 AD2d 412, 416, supra).

On the other hand, even under the strictest application of the Celestine/Gordon approach, an owner-in-fact may not be an "owner" under the statutes, when the owner has no control over or connection to the work being performed. This is illustrated in a series of cases arising from what might be termed "trespass" situations, where the fee holders of the property on which the injury occurred were unaware of, or even opposed to, the presence of workers and work activity. In Holman v City of New York (181 Misc 2d 15), a property owner who resisted and attempted to halt demolition work ordered by a trespassing municipality was exempted from the otherwise non-delegable duty imposed by the Labor Law because of "notions of reasonableness and fairness" which forced the court to conclude that the owner had been "deprived of the rights and privileges of such ownership" by the trespasser (see also, Ogden v City of Hudson Industrial Development Agency, 277AD2d 794, [edge of a stairway was placed, without authority, on neighbor's land]; Webb v 444 Central Park Owners, Inc., 248 AD2d 175 [worker was hired by another and entered premises without owner's knowledge or permission]; Marchese v Grossarth, 232 AD2d 924, lv den 89 NY2d 809 [worker entered premises to install cable connection without knowledge of or permission from the owner]; see also, discussion in Pouso v City of New York, 177 AD2d 560, 562-566, Balletta, J., concurring in part and dissenting in part). As one court explained:

Despite the seemingly absolute nature of the language used by the Court of Appeals [in Gordon], it is clear that the Court of Appeals, nevertheless, found liability only in a situation in which there was a nexus between ownership and the incident in issue.

(Anthony v Consolidated Rail Corporation, 161 Misc 2d 717, 722 [the base of a billboard was placed by mistake on a neighbor's property]).

If the party possesses less than full fee ownership, the requirement that there be some connection or "nexus" becomes even more critical. In Gordon itself, the very case in which the Court of Appeals held that the question a party's control of or benefit from the work was "legally irrelevant," the court nevertheless considered factors that sound very much like control to hold that the defendant was an owner not only of the land and building where the work was performed but also the actual structure (a railroad car) on which the work was being performed: "The very presence of the structure on its property was the direct result of Eastern's actions [in leasing the property to be used in cleaning and repairing railroad cars] and established a sufficient nexus for liability to attach to it as an ‘owner'" (Gordon v Eastern Railway Supply, Inc. (82 NY2d 555, at 560, supra).

In the instant claim, the State has no right to control either general use of Thruway Authority property or specific work projects on that property, nor does it benefit from such work. In addition, it does not possess full fee title to the property in question, and there is no "nexus" between the ownership interest held by the State (however that interest might be described) and the project on which claimant was working when she was injured. For the State to be held liable under the Labor Law statutes, therefore, the Court must find that having property held "in its name" by an independent, autonomous entity gives the State an ownership interest that is sufficiently close to fee title to warrant liability under the workplace safety statutes.

Research has revealed only one set of cases dealing with a somewhat analogous situation: the relationship between the City of New York and the New York City Transit Authority, with respect to land leased by the City to the Transit Authority. In Robinson v City of New York (211 AD2d 600), the First Department held that the City was not an "owner" of the Transit Authority's subway rails on which a worker was injured, because the City "had no actual or potential control over the worksite and retained a right of re-entry for non-transit purposes only." This decision was subsequently abrogated by the Court of Appeals in Coleman v City of New York (91 NY2d 821, aff'd 230 AD2d 762), which relied on the Celestine/Gordon line of cases to find that the City was an "owner" of the subway property. Rejecting an argument that the statutes creating the Transit Authority deprived the City of any ability to protect those working on the property, the Court of Appeals declined "to exempt the City -- which is in fact the owner -- from the plain word and reach of the statute, leaving that for the Legislature if it so chooses" (91 NY2d at 823).

The relationship between the City and the City Transit Authority, with respect to property used by the latter, is established in the Authority's enabling legislation, Public Authorities Law §1200 et seq. Although these provisions are in many ways similar to those that created the State Thruway Authority, there are critical differences. Whereas the Thruway Authority is empowered to "adopt a resolution assuming jurisdiction" of certain highways belonging to the State (Public Authorities Law §356), the parallel provision applicable to the City Transit Authority, Public Authorities Law §1203(1), contains the following, more limited delegation of powers:

[T]he city may * * * enter into an agreement with the [City Transit] authority for the transfer to the authority, for use in the execution of its corporate purposes, of the transit facilities now owned or hereafter acquired or constructed by the city * * *. Any such agreement shall provide for transfer of such facilities by deed, lease, license or other arrangement, provided the term thereof shall not be less than ten years * * *.


The property under consideration in Coleman v City of New York (supra) was leased from the City to the Transit Authority (230 AD2d 762).

The rest of section 1203 contains detailed terms and conditions that are to govern any such agreement. These call for, among other things, allocation of the responsibility for capital costs and City approval before the Authority can incur capital costs in its own name above a certain amount. In short, the enabling legislation that created the New York City Transit Authority is quite different from that that created the Thruway Authority, and the former contemplates much greater interaction and connection between the City and its Transit Authority than the latter establishes between the State and the Thruway Authority. The holding in Coleman, therefore, informs but does not control the situation presented here.

In the absence of clear guidance from either the Legislature or other courts, and mindful of the case law discussed above, this Court holds that the State of New York is not an "owner" of property that is held, controlled and maintained by the New York State Thruway Authority for purposes of imposing liability under the Labor Law workplace safety statutes. The legislation that created the Thruway Authority did not leave the State with any form of control over the use of the property or any connection to work projects taking place on the property. Nor did the enabling legislation impose on the types of interaction and connection between the State and the Thruway Authority that are found in the legislation creating the City Transit Authority. No matter how one describes the role of the State with respect to property that is "held in its name," it cannot equate to the traditional and recognized ownership interests of a "lessor."

Finally, this Court's decision rests upon policy considerations and a firm belief that the Legislature never contemplated making the State potentially liable for all Labor Law claims that arise from the operation of the numerous public authorities it has created. Along with the Thruway Authority, other public authorities that are authorized to acquire, hold and administer property "in the name of the state " include the State University Construction Fund (Education Law §373); the Hudson River Valley Greenway (Environmental Conservation Law §44-0113); the New York State Bridge Authority (Public Authorities Law §528); the New York State Power Authority (id, §1007); the Metropolitan Transportation Authority (id, §§1266, 1267-a); the Niagara Frontier Transportation Authority (id, §1299-gg); the Rochester-Genesee Regional Transportation Authority (id, §1299-ii); the Capital District Transportation Authority (id, §1308); the Dormitory Authority (id, §1678); the New York Job Development Authority (id, §1804); the New York State Energy Research and Development Authority (id, §1855); and the New York State Sports Authority (id, §2466). As with the Thruway Authority, many of these are routinely recognized as owner of the property over which they exercise jurisdiction, and they have been held subject to liability under the workplace safety statutes of the Labor Law (see, e.g., Reiner v Dormitory Auth. of the State of New York, 266 AD2d 443; Braun v Dormitory Auth. of the State of New York, 118 AD2d 614; Daley v City of New York, et al, 277 AD2d 88, [Metropolitan Transportation Authority]; Klos v New York City Transit Auth., et al., 240 AD2d 635, lv dismissed 91 NY2d 846 [Metropolitan Transportation Authority]; Kelleher v Power Auth. of the State of New York, 211 AD2d 918; Ortiz v Uhl, 39 AD2d 143, affd 33 NY2d 989, Reh. Denied 34 NY2d 961 [Power Authority]).[6]

The fact that these authorities have been held to be "owners" of the property they administer for purposes of the Labor Law does not, of course, decide the question of whether the State might not also be an "owner" because the property is held in its name. On the other hand, as noted above, the State exercises no right of control that could influence worker safety; there is no nexus between the State's ownership interest and work projects performed on the property; and the State does not retain any traditional, recognized ownership interest in property that is turned over to the jurisdiction of these authorities. The only possible rationale for imposing liability on the State because of its partial ownership interest would be to insure the financial security of workers. As the "trespass" cases establish, however, even full and unquestioned ownership may not be enough to support liability if there is essentially complete eradication of control or benefit, and, in addition, these public authorities are public institutions generally considered to be solvent as the State itself.[7] This fact removes the final remaining reason for imposing liability on the State in these circumstances.

For the reasons set forth above, the Court holds that the State of New York is not a proper defendant in this action and, on the Court's motion the Claim is dismissed. Having so decided, the Court does not reach the motion and cross-motion.



June 7, 2001
Albany, New York

HON. RICHARD E. SISE
Judge of the Court of Claims




[1] The relationship of Liberty and E & D, and ultimately which entity actually employed Claimant on the day of the accident, remains unclear but is not relevant to disposition of the instant motions.
[2] It is possible for there to be multiple "owners" of property for the purposes of the statutes (see, Young v Norton, 175 Misc 2d 175, 178-179 and cases cited therein).
[3] In Martino (supra), both the State and the Authority were sued and, in a supplemental order to the decision that was published, the State's motion to dismiss was granted (Martino v State of New York et ano., Claim No. 83477, Cross Motion No. CM-54509, filed July 6, 1992, Corbett, J.). Because both entities were sued in that action, the claimant did not oppose the motion and the issue, therefore, was not litigated between the parties.
[4] On the other hand, failure to list the Authority as a named defendant may be treated as a mere procedural defect if service was properly made on both the Authority and the Attorney General and there is no prejudice (Martino v New York State Thruway Authority, 154 Misc 2d 905, 911, supra). Where, as here, there has been no service upon the Thruway Authority, (see, MacFarland-Break v New York State Thruway Auth., 123 Misc 2d 307, affd 104 AD2d 139) the Court can not correct the defect and claimant must timely avail itself of the procedure to late-file a claim. (Court of Claims Act §10[6]; CPLR 214)
[5] Pursuant to Public Authorities Law §353, the purposes of the Authority are to "finance, construct, reconstruct, improve, develop, maintain or operate a thruway system" for the benefit of the people of New York.
[6] Of those listed above, only the Power Authority and the Thruway Authority are sued in the Court of Claims, which would create another inequity if the State, which can only be sued here, is to be considered an alternative "owner" defendant in actions based on the Labor Law.
[7] To some degree, the solvency of the authorities is, in fact, underwritten by the State (see, e.g., Public Authorities Law §§ 366, 367, 369, 373).