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Jana L. v. West 129th Street Realty Corp.10/11/2005
indemnity provision was ambiguous as to whose "ownership, use or operation of the property" triggered the obligation thereunder.
Additionally, Associates claimed that its managing member, Joseph Tahl, was "completely unaware" of the assault prior to the closing, and that had he known that Associates would be held liable, Associates "would not have proceeded with the closing on the terms set forth in the contract."
Supreme Court dismissed plaintiff's complaint against Associates but rejected Associates' argument that the indemnification provision did not expressly indemnify West Realty for its own negligence.
The court correctly determined that the indemnification provision was valid and applicable to the personal injury cause of action brought by plaintiff, and thus to the possible damages awarded for any negligence on the part of West Realty (see Gross v Sweet, 49 NY2d 102, 108 [exoneration clauses negotiated by sophisticated business entities can be viewed as merely allocating the risk of liability to third parties through the employment of insurance]). The court further took note of the fact that "financial adjustments made at closing pursuant to the contract treated Associates as the owner of the building on January 25" and that the insurance policy obtained by Associates provided coverage for that entire day. The court therefore properly determined that the parties intended for Associates to be protected by insurance, and held that an intention to indemnify a party against his own negligence was clearly implied from the language of the entire agreement and the surrounding circumstances (see Margolin v New York Life Ins., 32 NY2d 149, 153 ).
Nevertheless, the motion court denied West Realty's motion for summary judgment, holding that a triable issue of fact was raised by the question of whether West Realty was aware of the assault prior to closing and failed to disclose this material fact to Associates, thus foreclosing Associates' option of adjourning the closing for a day to avoid liability.
We disagree and reverse, and, for the reasons set forth below, grant summary judgment to West Realty on its cross claim for contractual indemnification.
The motion court erred in denying West Realty conditional contractual indemnification. Its holding that a triable issue of fact exists as to whether West Realty knew and failed to disclose the assault was based on an incorrect assumption that West Realty had a duty to disclose that fact to Associates.
There simply is no legal basis for a determination that West Realty, even if it knew about the assault prior to closing, had any duty to disclose such fact to Associates. It is well established that, absent a fiduciary relationship between the parties, a duty to disclose arises only under the 'special facts' doctrine where "'one party's superior knowledge of essential facts renders a transaction without disclosure inherently unfair'" (Swersky v Dreyer & Traub, 219 AD2d 321, 327 , quoting Chiarella v United States, 445 US 222, 247, 248 ; see also P.T. Bank Cent. Asia v ABN Amro Bank N.V., 301 AD2d 373, 378 ; Strasser v Prudential Secs., Inc., 218 AD2d 526 ).
Defendants agree that no fiduciary relationship exists between them. Associates, however, asserts that the "special facts" doctrine is applicable to the instant case. Associates claims that West Realty through its building superintendent had "superior knowledge of essential facts" about an assault prior to the closing, which knowledge Associates did not possess. Associates further relies on the holding in Strasser (218 AD2d at 527) to assert that this "disparity in the level of information" resulted in it "f
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