Defendant/Third-party Plaintiff’s default deemed admission of negligence fatal to third-party claim

Augustin Paez v. 1610 Saint Nicholas Avenue, L.P. et al., Supreme Court, New York County, Index No. 117172/2009 (April 16, 2013)

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A New York County Justice has dismissed a Third-party claim for contractual indemnification where the Defendant/Third-party Plaintiff’s default established that it had been negligent.

In a bodily injury case resulting from a slip and fall, a restaurant employee sued the owner of the building where he fell while working for the tenant, his employer. The owner defaulted, but the default had been vacated and the owner subsequently served a Third-party Complaint against the tenant/employer seeking common law and contractual indemnification and contribution. The common law indemnity and contribution causes of action were discontinued, because plaintiff had not suffered any “grave injury” as defined under the Workers Compensation Law.

The Third-party plaintiff moved for summary judgment to dismiss the remaining third-party claim for contractual indemnification, but before oral argument, an appeal of the Court’s prior decision vacating the default was decided--with a reversal. To consider how the reversal changed things, the Court permitted further briefing.

Justice Eileen A. Rakower held that the default was determinative. The plaintiff’s Complaint alleged that the owner had maintained the premises, that he had slipped and fallen there receiving injuries, and that the injuries were the result of the owner’s negligence. “Given Defendant’s default, all of the allegations, including the allegations of liability in Plaintiff’s Complaint are deemed admitted”, the Court said. This admission of liability prevented the Defendant from seeking contractual indemnification under its lease with the third-party defendant tenant/employer, because it could not establish that it was “free from any negligence”.

AGF&J partner Len Kamlet and associate Bryan Goldstein defended the tenant/employer, and briefed and argued the motion.