Case Name: Worth Distributors, Inc., Respondent, v. Gertrude G. Latham et al., Appellants, et al., Defendants. (And a Third-Party Action.) (And 42 Other Actions.)
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1983-06-14
Citations: 59 N.Y.2d 231
Docket Number: 
Parties: Worth Distributors, Inc., Respondent, v Gertrude G. Latham et al., Appellants, et al., Defendants. (And a Third-Party Action.) (And 42 Other Actions.)
Judges: 
Reporter: New York Reports
Volume: 59
Pages: 231–238

Head Matter:
Worth Distributors, Inc., Respondent, v Gertrude G. Latham et al., Appellants, et al., Defendants. (And a Third-Party Action.) (And 42 Other Actions.)
Argued May 5, 1983;
decided June 14, 1983
POINTS OF COUNSEL
Sheldon D. Camhy, Milton S. Gould and Willis H. Stephens, Jr., for Matilda Edwards, appellant.
I. Liability imposed under section 78 of the Multiple Dwelling Law does not extend to property damage on or to the premises of commercial subtenants used exclusively for business purposes. (Fitzgerald v 667 Hotel Corp., 103 Misc 2d 80, mod sub nom. Worth Distrs. v Latham, 88 AD2d 814; Hollman v Kayell Realty Co., 120 Misc 546; Sticker v Seril Realty Corp., 256 NY 687; Schauf v City of New York, 23 Misc 2d 585; Robinson v Shapiro, 484 F Supp 91, 646 F2d 734; Al's 334 9th Ave. Corp. v Herbener, 275 App Div 904; Creston Burnside Holding Corp. v Ken-Ross Assoc., 47 Misc 2d 759; People v Scott, 26 NY2d 286; Altz v Leiberson, 233 NY 16.) II. The City of New York is not entitled to indemnification from the owners. (Green Bus Lines v Consolidated Mut. Ins. Co., 74 AD2d 136; Westchester Light. Co. v Westchester County Small Estates Corp., 278 NY 175; Putvin v Buffalo Elec. Co., 5 NY2d 447; McFall v Compagnie Maritime Belge [Lloyd Royal], 304 NY 314; Mauro v McCrindle, 70 AD2d 77, 52 NY2d 719; Dole v Dow Chem. Co., 30 NY2d 143; Kelly v Long Is. Light. Co., 31 NY2d 25; Rogers v Dorchester Assoc., 32 NY2d 553; Riviello v Waldron, 47 NY2d 297; Malette v Loblaws, Inc., 61 AD2d 1054.)
William H. Morris and Gerald P. McMorrow for Gertrude G. Latham, appellant.
I. Section 78 of the Multiple Dwelling Law is not applicable to property damage and loss of business use claims arising out of commercial occupancies. (Altz v Leiberson, 233 NY 16; Emigrant Ind. Sav. Bank v One Hundred Eight West Forty-Ninth St. Corp., 255 App Div 570, 280 NY 791; Gold v Springer, 206 NY 641; Weiner v Leroco Realty Corp., 279 NY 127.) II. There was a breach of duty by the city towards parties in a special relationship to it and such breach of duty constituted active negligence precluding common-law indemnification against Latham-Edwards. (Glanzer v Shepard, 233 NY 236; Florence v Goldberg, 44 NY2d 189; Motyka v City of Amsterdam, 15 NY2d 134; Schuster v City of New York, 5 NY2d 75; Smullen v City of New York, 28 NY2d 66; De Long v County of Erie, 89 AD2d 376; Dole v Dow Chem. Co., 30 NY2d 143; Rogers v Dorchester Assoc., 32 NY2d 553; McFall v Compagnie Maritime Beige [Lloyd Royal], 304 NY 314.)
Frederick A. O. Schwarz, Jr., Corporation Counsel (Stephen J. McGrath and Leonard Koerner of counsel), for City of New York, appellant.
The acts for which the City of New York was found liable in negligence may not form a predicate for liability against it; the judgment should be reversed, and all claims against the city should be dismissed. (Weiner v Metropolitan Transp. Auth., 55 NY2d 175; Riss v City of New York, 22 NY2d 579; Messineo v City of Amsterdam, 17 NY2d 523; Motyka v City of Amsterdam, 15 NY2d 134; Steitz v City of Beacon, 295 NY 51; Infosino v City of New York, 25 AD2d 841, 18 NY2d 583; Whitney v City of New York, 27 AD2d 528; Rivera v City of Amsterdam, 5 AD2d 637; Stranger v New York State Elec. & Gas Corp., 25 AD2d 169; Garrett v Town of Greece, 78 AD2d 773, 55 NY2d 774.)
Stephen W. O’Leary for Worth Distributors, Inc., plaintiff-respondent.
I. The city was properly held liable for the collapse resulting from gross negligence in performance of mandatory statutory duties conferred upon it in a situation where the city had actual knowledge of a hazardous and dangerous condition which would worsen if steps were not taken to correct it and where the city undertook to advise and act in the premises. (Matter of Alva S. S. Co. v City of New York, 405 F2d 962; Mazelis v Wallerstein, 51 AD2d 579; Gannon Personnel Agency v City of New York, 55 AD2d 548.) II. The owners are liable to Worth Distributors, Inc., at common law and pursuant to the Multiple Dwelling Law. (Lieberman v Washington Sq. Hotel Corp., 40 AD2d 647; Appel v Muller, 262 NY 278; Weiner v Leroco Realty Corp., 279 NY 127.)
William C. Viets and Gary Alexander Stahl for Mercer Arts Center, Inc., plaintiff-respondent.
I. Tort liability is imposed where a municipal corporation with actual knowledge of a specific dangerous condition fails to act in accor dance with the duty of care it has specifically assumed. (Fitzgerald v 667 Hotel Corp., 103 Misc 2d 80, mod sub nom. Worth Distrs. v Latham, 88 AD2d 814; Riss v City of New York, 22 NY2d 579; Moch Co. v Rensselaer Water Co., 247 NY 160; Runkel v City of New York, 282 App Div 173; Glanzer v Shepard, 233 NY 236; Wolfv City of New York, 39 NY2d 568; Smullen v City of New York, 28 NY2d 66; Schuster v City of New York, 5 NY2d 75; Gannon Personnel Agency v City of New York, 103 Misc 2d 60.) II. The owners are liable to Mercer Arts Center under the Multiple Dwelling Law. (Altz v Lieberson, 233 NY 16; Matter of Roosevelt Raceway v Monaghan, 9 NY2d 293; Bender v Jamaica Hosp., 40 NY2d 560; Hollman v Kayell Realty Co., 120 Misc 546; Sticker v Seril Realty Corp., 256 NY 687; Creston Burnside Holding Corp. v Ken-Ross Assoc., 47 Misc 2d 759; Robinson v Shapiro, 484 F Supp 91, 646 F2d 734; Schauf v City of New York, 23 Misc 2d 585; Al’s 334 9th Ave. Corp. v Herbener, 275 App Div 904; Rogers v Dorchester Assoc., 32 NY2d 553.)
Edgar T. Schleider for other plaintiffs-respondents.
I. The facts support liability of defendant owners, Edwards and Latham, to all plaintiffs under the Multiple Dwelling Law. (Weiner v Leroco Realty Corp., 279 NY 127; Tkach v Montefiore Hosp. for Chronic Diseases, 264 App Div 135, 289 NY 387; Robinson v Shapiro, 484 F Supp 91; Hollman v Kayell Realty Co., 120 Misc 546; Sticker v Seril Realty Corp., 256 NY 687; Al's 334 9th Ave. Corp. v Herbener, 275 App Div 904.) II. Apart from statute, defendants Edwards and Latham, as owners, had a common-law duty of maintenance because of the reservation in the lease of the right to enter, inspect and repair the premises. (Antonsen v Bay Ridge Sav. Bank, 292 NY 143; Noble v Marx, 298 NY 106; Reische v Montgomery, 273 App Div 824; Abrams v Manhattan Dial Mfg. Co., 190 Misc 106; Guinee v Estate of Hoffman, Inc., 283 App Div 691; Swords v Edgar, 59 NY 28; Cullings v Goetz, 256 NY 287; People v Scott, 26 NY2d 286.) III. Appellant City of New York was clearly negligent in the performance of the duties of its building department; no unreasonable burden would be imposed by requiring due care in the facts of this case; the decisions denying duty are inapplicable to these facts. (Smullen v City of New York, 28 NY2d 66; Schuster v City of New York, 5 NY2d 75; Gannon Personnel Agency v City of New York, 103 Misc 2d 60, 81 AD2d 755.)
Frederick A. O. Schwarz, Jr., Corporation Counsel (Stephen J. McGrath and Leonard Koerner of counsel), for City of New York, respondent.
I. As this court held in O’Connor v City of New York (58 NY2d 184), a municipality may not be cast in liability for breach of a general statutory duty. As thé city did not have a special relationship with any party to this action, all claims against it must be dismissed. (Gannon Personnel Agency v City of New York, 81 AD2d 755, revd sub nom. O’Connor v City of New York, 58 NY2d 184; Sanchez v Village of Liberty, 42 NY2d 876, 44 NY2d 817; Smullen v City of New York, 28 NY2d 66; Garrett v Holiday Inns, 58 NY2d 253; Motyka v City of Amsterdam, 15 NY2d 134; Garrett v Town of Greece, 55 NY2d 774; Florence v Goldberg, 44 NY2d 189.) II. Should this court determine that the city may be held liable to plaintiffs, the trial court’s award of indemnification to the city against defendant owners Edwards and Latham, which was affirmed by the court below, should not be disturbed. (Mazelis v Wallerstein, 51 AD2d 579; McDermott v City of New York, 50 NY2d 211; Runkel v Homelsky, 286 App Div 1101, 3 NY2d 857; Dole v Dow Chem. Co., 30 NY2d 143; Rogers v Dorchester, 32 NY2d 553; Crawford v Blitman Constr. Corp., 1 AD2d 398; D’Ambrosio v City of New York, 55 NY2d 454.)

Opinion:
OPINION OF THE COURT
Per Curiam.
This case arose out of the collapse of a portion of the Broadway Central Hotel building in lower Manhattan on August 3, 1973. Four persons were killed, many others were injured, and a number of businesses suffered extensive property damage.
Forty-three actions to recover for wrongful death, personal injury, and property damage were consolidated. After a nonjury trial, Supreme Court held that the owners of the building were 25% liable, the net lessee was 45% liable, and the City of New York was 30% liable. The city was held to be entitled to indemnification by the owners, and its liability for property damage limited to the value of the property that could have been removed from the building had the city taken prompt action. The court found the city liable because of its department of buildings' failure to ensure that the building's dangerous condition was remedied before it collapsed. The Appellate Division modified by granting the city judgment on its indemnification cross claim against the net lessee.
The city should not have been held liable. As this court recently reaffirmed, "it has long been the rule in this State that, in the absence of some special relationship creating a duty to exercise care for the benefi t of particular individuals, liability may not be imposed on a municipality for failure to enforce a statute or regulation" (O'Connor v City of New York, 58 NY2d 184, 192). Here the city building department failed to enforce provisions of the city's Administrative Code relating to building safety, even though its employees knew of the dangerous structural conditions in the building. These regulations were designed to protect the general public, however, and no special relationship has been shown that would establish a municipal duty to the instant plaintiffs in particular. Thus, the complaints should be dismissed as against the City of New York, and apportionment of liability among the remaining defendants redetermined accordingly.
Appellants Latham and Edwards, the building's owners, assert that it was also error to impose liability against them. They argue that violation of section 78 of the Multiple Dwelling Law, which requires an owner of a multiple dwelling to keep its building in good repair, cannot form the basis for liability to commercial tenants in the building. It is not disputed that the building, which contained residential units, was a multiple dwelling. Section 78 places on the owner the duty to see that "[ejvery multiple dwelling, including its roof or roofs, and every part thereof and the lot upon which it is situated, shall be kept in good repair." The defect in this case involved a structural problem — an ever-widening crack in a major weight-bearing wall — that was central to the entire building. Likewise, the resulting collapse obviously affected the structure as a whole. The dangerous condition had a direct and unquestionable "relation to the maintenance of the building as a tenantable habitation" (Altz v Leiberson, 233 NY 16, 18). In such a case, the owner's duty to repair the defect is not affected by the use for commercial purposes of portions of the structurally unsafe building (see Sticker v Seril Realty Corp., 256 NY 687).
Although an owner will not be held liable under section 78 where it has completely parted with possession and control of the building, the owners here reserved the right under the terms of the net lease to enter for inspection and repairs. This reservation constituted a sufficient retention of control to subject the owners to liability (see Tkach v Montefiore Hosp. for Chronic Diseases, 289 NY 387, 390; Weiner v Leroco Realty Corp., 279 NY 127, 130; Appel v Muller, 262 NY 278, 283-284). In addition, there was an affirmed finding below that the owners had both constructive notice of the long-standing defect and, through their agent, the husband of one of the owners, actual notice of the dangerous condition. There was, therefore, a sufficient basis for the trial court's finding of liability against the owners.
Accordingly, the order of the Appellate Division should be modified, with costs to the City of New York against plaintiffs, and the case remitted to Supreme Court, New York County, for further proceedings in accordance with this opinion and, as so modified, affirmed, with costs to plaintiffs against appellants Latham and Edwards. The question certified is answered in the negative.
Chief Judge Cooke and Judges Jasen, Jones, Wachtler, Meyer and Simons concur in Per Curiam opinion.
Order modified, etc.
Subdivision 4 of section 4 of the Multiple Dwelling Law defines a "dwelling" as "any building or structure or portion thereof which is occupied in whole or in part as the home, residence or sleeping place of one or more human beings." Subdivision 7 of section 4 defines a "multiple dwelling", in relevant part, as follows: "a dwelling which is either rented, leased, let or hired out, to be occupied, or is occupied as the residence or home of three or more families living independently of each other A 'multiple dwelling' shall not be deemed to include a hospital, convent, monastery, asylum or public institution, or a fireproof building used wholly for commercial purposes except for not more than one janitor's apartment and not more than one penthouse occupied by not more than two families" (emphasis supplied).