Summary
In D'Ambrosio, however, this court abrogated the "special benefit" rule and held that the City could not seek common-law indemnification from the adjacent landowner for "trip and fall" damages resulting from a poorly maintained sidewalk appurtenance, at least in the absence of an undertaking by the property owner "to repair for the benefit of the municipality" (55 N.Y.2d, at 463, supra).
Summary of this case from City of New York v. Kalikow Realty CompanyOpinion
Argued February 9, 1982
Decided April 6, 1982
Appeal from the Appellate Division of the Supreme Court in the First Judicial Department, PELHAM ST. GEORGE BISSELL, J.
Brian J. Shoot for appellant.
Anthony J. McNulty, Joseph Messina and William F. McNulty for third-party defendant-appellant. Frederick A.O. Schwarz, Jr., Corporation Counsel ( Ronald E. Sternberg and Leonard Koerner of counsel), for respondent.
The issue on this appeal is the effect of our decision in Dole v Dow Chem. Co. ( 30 N.Y.2d 143) on the so-called "special benefit" rule. This rule allows a municipality, charged with the duty of maintaining its sidewalks in a reasonably safe condition, to shift liability to the abutting landowner, where the cause of plaintiff's injuries is the failure of the landowner to reasonably maintain a sidewalk installation constructed for the special use and benefit of his property. We hold today that the "special benefit" rule is no longer available to shift entirely such liability to the landowner; rather, the liability is to be apportioned between the municipality and the landowner, based upon their respective degrees of fault.
Plaintiff sustained injuries when she was caused to trip on a metal disk embedded in the sidewalk. The disk, raised about one inch above the sidewalk, covered the housing for a shut-off valve in the service pipe which brought water to the abutting premises from the water main running under the street. The curb valve was installed by a former owner of the abutting premises, presumably for the benefit of his property.
Plaintiff brought suit against the City of New York (City), alleging that it had breached its duty to maintain the public sidewalk on which she fell in a reasonably safe condition, by suffering a dangerous and defective condition to exist, of which it had knowledge and notice. Prior to trial, plaintiff entered into a settlement agreement with the abutting landowner, by which plaintiff settled all "past, present and future claims" against the landowner in return for the sum of $22,500.
Following service of the complaint against the City, the City served a third-party summons and complaint upon the landowner, Harriet S. Hopp. This complaint sought recovery over against Hopp for any amount that might be recovered by the plaintiff against the City, on the ground that it was Hopp's negligent maintenance of the water box, installed for the special use and benefit of Hopp's premises, that caused plaintiff's injuries.
The testimony at trial indicated that plaintiff tripped over the raised water disk, which she could not see, as she was attempting to avoid cracks in the sidewalk a short distance ahead. The sidewalk immediately surrounding the condition was described as cracked and sloping downward toward the disk. Expert testimony was adduced to the effect that the one-inch elevation of the metal disk was improper, and that curb valves should be maintained flush with the surrounding sidewalk. Plaintiff testified that, about one year before her accident, she had seen a woman fall in the same area, and that a policeman and ambulance arrived at the scene to assist the injured woman, who stated that she had tripped over the water cap.
The case was submitted to the jury in two stages. With respect to the liability determination, the jury found that both the City and Hopp were negligent in allowing the sidewalk condition to go unrepaired, resulting in plaintiff's injuries. The issues of the amount of plaintiff's damages and of the relative fault of the City were then submitted to the jury. Plaintiff was awarded $100,000 in damages; the City was found 65% responsible. The City's motion for judgment over against Hopp was denied without comment by the court. Judgment was entered for plaintiff against the City in the amount of $65,000 (reduced by the proportionate amount of Hopp's fault, by reason of plaintiff's having settled her claim against Hopp [see General Obligations Law, § 15-108]).
The City appealed to Appellate Term, which modified the judgment by awarding the City full indemnification on its third-party complaint against Hopp, based on the so-called "special benefit" rule. Under this rule, the municipality that has been cast in damages for its failure to maintain the sidewalk in a reasonable condition may, notwithstanding its own negligence, obtain judgment over against the property owner for whose benefit a sidewalk appurtenance was installed, where it is the defective condition of the appurtenance that caused the injury.
An appeal by Hopp resulted in an affirmance by the Appellate Division, on the reasoning of Appellate Term. The Appellate Division granted plaintiff and Hopp leave to appeal to this court. We now reverse.
A threshold issue concerns whether an appeal properly lies from the order of the Appellate Division by the plaintiff. The Appellate Division order, affirming the order of Appellate Term, resolves issues of liability only as between the municipality and the abutting landowner. It has no direct effect on the right of plaintiff to recover full judgment. Plaintiff is not an "aggrieved party" within the meaning of CPLR 5511 by reason of the resolution of the respective liability of the third-party plaintiff and defendant. Rather, plaintiff's rights are affected solely by virtue of a settlement agreement between her and the third-party defendant, the validity and interpretation of which have not been determined in this litigation. The appeal of the plaintiff, therefore, should be dismissed.
Turning to the merits of the appeal, we are asked to determine the effect of the rule announced in Dole v Dow Chem. Co. ( 30 N.Y.2d 143, supra), allowing joint, actively negligent tort-feasors to seek contribution among themselves in proportion to their respective degrees of fault, upon the "special benefit" rule, which allows a municipality to shift liability for damages to one harmed by a defective condition in the sidewalk to the owner of the abutting premises, under some circumstances.
It was once the rule in this State that contribution among joint tort-feasors could not be had. The reason for this common-law rule barring apportionment was the belief that the courts should not participate in adjusting the relative rights of wrongdoers ( Dole v Dow Chem. Co., 30 N.Y.2d 143, 147, supra). This rule was abrogated partially in 1928, with the addition of section 211-a to the Civil Practice Act. Under that statute, if judgment were recovered by a plaintiff against more than one joint tort-feasor, one tort-feasor who had been required to pay more than his pro rata share to the plaintiff could recover the excess from the other adjudicated tort-feasors. The paying tort-feasor was expressly given the right to proceed against the others in a separate action. The statute left the decision of which defendants could be adjudicated joint tort-feasors entirely in the hands of the plaintiff, however, and a named defendant could not bring others into the suit on the basis of his belief that they should contribute to any judgment awarded to plaintiff ( Fox v Western N.Y. Motor Lines, 257 N.Y. 305).
Notwithstanding the rigid rules regarding contribution rights among joint tort-feasors, a common-law right of indemnification existed, allowing one who was compelled to pay for the wrong of another to recover from the wrong-doer the damages paid to the injured party ( Westchester Light. Co. v Westchester County Small Estates Corp., 278 N.Y. 175; Oceanic Steam Nav. Co. v Compania Transatlantica Espanola, 134 N.Y. 461). Thus, for example, where the master had been held liable for the tort of his servant, on a theory of respondeat superior, but the master was himself free from wrong, the master was entitled to indemnification from his servant ( Opper v Tripp Lake Estates, 274 App. Div. 422, affd 300 N.Y. 572). In the classic indemnification case, the one entitled to indemnity from another had committed no wrong, but by virtue of some relationship with the tort-feasor or obligation imposed by law, was nevertheless held liable to the injured party.
Over the years, the doctrine of "implied indemnification" was extended in response to the potentially harsh results of the inflexible rules barring contribution among joint tort-feasors. Thus, one who was cast in damages for negligence could, if his negligence were merely "passive", nevertheless shift his liability to the tort-feasor whose negligence was considered "active". The "actively negligent tort-feasor is considered the primary or principal wrongdoer and is held responsible for his negligent act not only to the person directly injured thereby, but also to any other person indirectly harmed by being cast in damages by operation of law for the wrongful act" ( McFall v Compagnie Maritime Belge [ Lloyd Royal] S.A., 304 N.Y. 314, 328; see, also, Tipaldi v Riverside Mem. Chapel, 298 N.Y. 686, affg 273 App. Div. 414). One who was himself actively negligent could not, of course, receive the benefit of this doctrine; it was available only to shift full liability from the secondary to the primary wrongdoer, and its availability depended upon the level of culpability of the one seeking indemnity ( Bush Term. Bldgs. v Luckenbach S.S. Co., 9 N.Y.2d 426; Jackson v Associated Dry Goods Corp., 13 N.Y.2d 112). The inquiry became primarily a question of the degree of fault, or the "factual disparity between the delinquency" of the several tort-feasors ( McFall v Compagnie Maritime Belge [ Lloyd Royal] S.A., 304 N.Y. 314, 330, supra). Such efforts to ameliorate the effects of the bar to contribution were far from complete, however, since the "active-passive" terminology was not easily applied. Moreover, the result of its application was complete, not ratable, recovery by the less negligent tort-feasor against the one guilty of "active" negligence.
Against this background, Dole v Dow Chem. Co. ( supra), was decided, drastically changing the law of this State regarding the apportionment rights of joint tort-feasors. Dole rejected the unpredictable result of attempting to shift entire liability based upon the theory of whose negligence was the greater, and adopted the more realistic approach of holding joint tort-feasors liable according to their respective degrees of fault. To this end, the named defendant could either bring in another tort-feasor by impleading him into the plaintiff's main action, or seek contribution by way of a separate action against one believed to also be at fault.
In later cases, we clarified the scope of our holding in Dole. In Rogers v Dorchester Assoc. ( 32 N.Y.2d 553), we explained that the rule of apportionment enunciated in Dole did not abrogate basic principles of "common-law indemnification between vicariously liable tort-feasors and tort-feasors guilty of the acts or omissions causing the harm. In short, the apportionment rule applies to those who in fact share responsibility for causing the accident or harm, and does not extend further to those who are only vicariously liable, as the employer of a negligent employee, the owner of a motor vehicle operated by a negligent driver, or * * * the owner of a building who contracts with an independent contractor exclusively responsible for maintenance of the building or parts of it" ( id., at pp 565-566). Thus, where one is held liable solely on account of the negligence of another, indemnification, not contribution, principles apply to shift the entire liability to the one who was negligent (see, also, Logan v Esterly, 34 N.Y.2d 648).
The issue in the present case is the effect of Dole and subsequent developments on the "special benefit" rule. The municipality owes a duty to keep the public sidewalks in a reasonably safe condition. A failure to repair a defective condition, of which it has notice, either actual or constructive, will cast the municipality in liability for damages to a person injured thereby. Where the cause of the injury is the defective condition of a sidewalk appurtenance installed for the special use or benefit of the owner of the abutting premises, however, the rule has developed that the municipality may receive indemnity from the landowner ( Trustees of Vil. of Canandaigua v Foster, 156 N.Y. 354; Schrold v City of New York, 273 App. Div. 872, affd 298 N.Y. 738; Ohrt v City of Buffalo, 281 App. Div. 344). The precise question posed, then, is whether this "special benefit" rule was a recognition of a common-law right to indemnification, in that the municipality is entitled to recovery because it has been cast in liability solely for the landowner's negligence, or whether the rule is but one application of the doctrine permitting the secondary wrongdoer, notwithstanding his own negligence, to shift his liability to a wrongdoer guilty of a greater degree of negligence. An examination of the approach taken in cases involving the special benefit rule persuades us that the nature of this claim falls within the latter category (see, e.g., Lobello v City of New York, 268 App. Div. 880, affd 294 N.Y. 816; Olivia v Gouze, 285 App. Div. 762, affd 1 N.Y.2d 811; Kaplan v City of New York, 269 App. Div. 856; Johnsen v Gallagher, 28 A.D.2d 560, affd 21 N.Y.2d 981).
When a sidewalk appurtenance negligently falls into disrepair, both the municipality and the landowner have breached their respective duties to members of the public, and both may be made to respond in damages to those injured by the defective condition. If the municipality pays the damages, it is not being compelled to pay for the wrong of another; it is simply being held liable for its own failure to exercise reasonable care. The landowner's obligation to maintain the sidewalk appurtenance runs, not to the municipality, but to the pedestrians who might be harmed by his negligence. The landowner has not undertaken any obligation to repair for the benefit of the municipality (cf. Rogers v Dorchester Assoc., 32 N.Y.2d 553, supra). Thus, we conclude that the shifting of the municipality's liability to the landowner was not the classic form of indemnity; rather, it was a recognition that the municipality's culpability was only secondary where the precise instrumentality causing the injury was installed for the landowner's special benefit.
We note that the dissent (at pp 470-471) chooses to give no effect to the evidence adduced at trial that plaintiff was attempting to avoid cracks in the sidewalk a few feet ahead of her (a condition for which the City is concededly responsible) or to evidence regarding the City's actual notice of the defect in the sidewalk appurtenance. This evidence regarding the City's breach of its duty of care was properly before the jury, and while it was not made the basis of a specific theory of recovery, neither was the defect in the sidewalk appurtenance made a specific theory of recovery. Rather, the jury was instructed in very general terms, that on the evidence before it, it was to determine whether the City and/or the landowner breached their respective duties of care. The court did not marshal the evidence on this issue, nor did it refer specifically to any part of it.
Since Dole has eliminated the necessity for continuing such distinctions, we conclude that the special benefit rule is not applicable to impose an obligation of indemnification on the landowner; liability is to be apportioned on the basis of the respective violations of duty owed by the alleged joint tort-feasors to the plaintiff. The primary inquiry in any such case should be the extent to which each of the negligent parties has contributed to the defective condition. In a particular case, of course, the inquiry may result in a finding that only one of the parties was responsible for the defect; in that event, full liability should be incurred by that party alone (cf. Dole v Dow Chem. Co., 30 N.Y.2d 143, 153, supra).
Inasmuch as the City has failed to present a basis on which the jury's determination of its respective degree of fault should be overturned, the order of the Appellate Division should be reversed, with costs, and the judgment of Civil Court should be reinstated. As to the plaintiff, appeal should be dismissed.
I do not question the authority of the court to reach the conclusion reached by the majority, for the Legislature has spoken only to the converse of the problem we confront and has, apparently deliberately, left to us the ultimate determination of what the rules governing the separation between indemnity and contribution should be, while at the same time noting that our court "may wish to consider the suggestions offered" in section 886B of the Restatement of Torts, Second, suggestions which, if followed, would produce a result contrary to that of the majority. I do, however, seriously question the reasoning, both substantive and procedural, which underlies the majority's conclusion that the special benefit rule does not provide a basis for the City to obtain indemnity from the specially benefited property owner. I, therefore, dissent.
CPLR 1404 (subd [b]) provides that "Nothing contained in this article [which deals with contribution] shall impair any right of indemnity or subrogation under existing law."
CPLR article 14 and section 15-108 of the General Obligations Law were proposed in the Twelfth Annual Report of the Judicial Conference to the Legislature on the Civil Practice Law and Rules. That report, which is reprinted in the Twentieth Annual Report of the Judicial Conference, stated CPLR 1404 (subd [b]) to be "[i]n keeping with the premise that Dole was intended essentially to modify the law of contribution, leaving much of the traditional common law of indemnity unchanged" (Twentieth Ann Report of N Y Judicial Conference, 1975, p 222; see, also, p 216).
The full paragraph in which the quoted words may be found reads (Twentieth Ann Report of N Y Judicial Conference, 1975, p 222): "No attempt has been made to list here those situations in which a right to indemnity, in the sense of a complete shifting of the entire financial burden from one tortfeasor to another (See McFall v. Compagnie Maritime Belge, 304 N.Y. 314, 327-28 (1852)), exists. The Court of Appeals is in the process of formulating new guidelines ( Rogers v. Dorchester Associates; Kelly v. Long Island Lighting Co.) and this development of the substantive law should be left to them. The Court may wish to consider the suggestions offered in a draft of the Restatement ( Second) of Torts which has attempted to separate contribution from indemnity as the Court of Appeals did in Rogers and as this Article does and has listed specific situations in which indemnity is available even in the absence of an express contract of indemnity. Restatement ( Second) of Torts § 886B (Tent. Draft No. 16, 1970)." Moreover, the report noted ( id., p 212) that it was based on a study by Professor M.E. Occhialino of the Syracuse University College of Law published as part of the Nineteenth Annual Report of the Conference. The Occhialino study contained the following relevant paragraphs (Nineteenth Ann Report of N Y Judicial Conference, 1974, pp 242-243):
"So too any proposed change in New York law should reflect the fact that Dole, while working within the framework of implied indemnity, actually varied the rule of contribution. Therefore, it is entirely consistent with the reasoning of the Court of Appeals to modify the contribution statute to reflect the impact of Dole while at the same time expressly preserving inviolate common law principles of indemnity, other than those resting solely on the discarded 'active-passive' test, and providing that where one doctrine is applicable, the other is not.
"No attempt has been made here to list specifically those factual situations in which, under Rogers, indemnity rules rather than contribution rules will be applied. That task is one for the Court itself, and any proposed statutory change should be designed to accommodate subsequent judicial decisions specifying the scope of the indemnity doctrine. A pending proposal to include in the Restatement (Second) of Torts a new section specifically identifying those situations in which indemnity and not contribution is appropriate[18] may offer some guidance to the Court of Appeals as it develops in more detail the scope of traditional indemnity principles." (Emphasis supplied.)
Footnote 18 reprinted in full proposed section 886B of the Restatement, the pertinent part of which appears in the text of this opinion following footnote 7.
(See text following n 7.)
The morass in decisional law into which the active-passive, actual-constructive, primary-secondary dichotomies have lead has been chronicled elsewhere and at length. The "persistent criticism" and "widespread dissatisfaction with the inequity of result" lead us, in Dole v Dow Chem. Co. ( 30 N.Y.2d 143, 148, 149), to adopt a rule that "where a third party is found to have been responsible for a part, but not all, of the negligence for which a defendant is cast in damages, the responsibility for that part is recoverable by the prime defendant against the third party." The Dole rule, characterized by us as one of "relative contribution" ( Kelly v Long Is. Light. Co., 31 N.Y.2d 25, 29), was not "intended to overturn basic and satisfactory principles of common-law indemnification between vicariously liable tort-feasors and tort-feasors guilty of the acts or omissions causing the harm" ( Rogers v Dorchester Assoc., 32 N.Y.2d 553, 565-566), and "does not mean that where a defendant is only derivatively liable * * * full responsibility for paying the judgment cannot be assessed against the actively negligent party" ( Logan v Esterly, 34 N.Y.2d 648, 651).
(Meriam Thornton, Indemnity Between Tort-feasors: An Evolving Doctrine In the New York Court of Appeals, 25 N.Y.U L Rev 845, 860 ["an uncharted realm where speculation will inevitably supplant reliable interpretation"]; Davis, Indemnity Between Negligent Tortfeasors: A Proposed Rationale, 37 Iowa L Rev 517, 543 ["hopeless muddle of (New York) precedents"]; Leflar, Contribution and Indemnity Between Tortfeasors, 81 U of Pa L Rev 130, 156 ["The inadequacy of the words 'passive' and 'active' as a test of the propriety of allowing indemnity in hard cases must be apparent"].) The difficulty caused Justice CHARLES D. BREITEL, as he then was, to note in Bush Term. Bldgs. Co. v Luckenbach S.S. Co. ( 11 A.D.2d 220, 227, revd 9 N.Y.2d 426) that the "terminology * * * can be manipulated to produce any result," and Justice MATTHEW M. LEVY in Falk v Crystal Hall ( 200 Misc. 979, 984, affd 279 App. Div. 1073, mot for lv to app den 280 App. Div. 861), to note the confusion arising from the "attempt to fit specific cases into the bare cubicles of easy nomenclature."
There are, of course, bases for indemnification other than that the one seeking indemnity was only vicariously or derivatively liable (see McDermott v City of New York, 50 N.Y.2d 211, 218, n 4). The fallacy of the majority analysis is that, in concentrating on the use of active-passive language in some of the special benefit cases, it overlooks the case law clearly establishing, contrary to its conclusion, that the owner of property specially benefited by a sidewalk appurtenance does indeed owe a duty to the municipality in whose sidewalk the appurtenance has been put to prevent injury to third persons. Its error is in its "focus on the character of the breach, rather than on the nature of the underlying duties involved" (Davis, Indemnity Between Negligent Tortfeasors: A Proposed Rationale, 37 Iowa L Rev 517, 543).
The duty that arises from use for his own benefit of a sidewalk or highway is "in consideration of private advantage" ( Heacock v Sherman, 14 Wend 58, 60). In effect, by accepting the benefit of using the street or sidewalk for his special benefit, the property owner contracts to perform as to the benefit area the municipality's duty and is liable to the municipality for failure to do so (see City of Brooklyn v Brooklyn City R.R. Co., 47 N.Y. 475, 485). The implied duty assumed when a special benefit appurtenance is installed covers not only proper construction in the first instance but reasonable care in its maintenance ( Trustees of Vil. of Canandaigua v Foster, 156 N.Y. 354, 360; see Babbage v Powers, 130 N.Y. 281, 286). It is moreover an implied duty which, as we declared in Canandaigua ( supra, at pp 361-362), "requires reasonable precaution on the part of the owner to protect the public as long as he remains the owner and is in possession of any part of the building on the abutting land. He cannot cast the burden of maintenance on the public any more than he could have cast upon them the burden of original construction, for the grate is wholly for the benefit of his property. Nor can he relieve himself of the duty without parting with the entire possession of the property benefited, for the safety of the public requires that the owner, as long as he is in possession of any part of the property, should be compelled to keep his structure in the sidewalk in suitable condition for use as a part of the sidewalk. As the duty is imposed by law for the public safety, its extent is measured by whatever public safety requires." In consequence, the municipality is permitted to recover "as representatives of the general public entitled to free and safe passage over the sidewalk" ( id., at p 360), the entire amount paid by it, notwithstanding that recovery against it was on the ground that the "authorities knew, or should have known" ( id., at p 358) that the appurtenance was out of repair.
Ordinarily, a property owner is not responsible for the maintenance of the sidewalk or street abutting his property (Ann., 88 ALR2d 331), and is not liable either to one injured by its disrepair or to indemnify the municipality absent a statute which not only requires that he maintain the sidewalk or highway but speaks expressly to injury resulting from disrepair (compare Willis v Parker, 225 N.Y. 159, with City of Rochester v Campbell, 123 N.Y. 405, and Russell v Village of Canastota, 98 N.Y. 496; and see Village of Fulton v Tucker, 3 Hun 529). But when the sidewalk includes an appurtenance for the special benefit of his property, the municipality is entitled to rely, as between the owner and itself though not as to an injured third party, upon performance by the owner of his obligation to maintain the appurtenance in safe condition, just as much as the municipality would be entitled to rely upon, and therefore has the right to be indemnified by, one who has voluntarily assumed the duty of maintenance ( Doyle v Union Ry. Co. of N.Y., 276 N.Y. 453, 458) or has expressly contracted to do so ( Rogers v Dorchester Assoc., 32 N.Y.2d 553, 562, supra; Burke v City of New York, 2 N.Y.2d 90, 94; Beinhocker v Barnes Dev. Corp., 296 N.Y. 925). In this respect the special benefit indemnity rule differs from that governing the indemnity liability of a person causing injuries on a sidewalk or on a highway in which there is no special benefit appurtenance, for in the latter case the obligation to indemnify arises not from the tort-feasor's special or particular duty to the public or from any express agreement, but from the principle that everyone is responsible for the consequences of his own negligence and must reimburse a municipality compelled to pay for an injury for which the primarily liable wrongdoer should have paid ( Oceanic Steam Nav. Co. v Compania Transatlantica Espanola, 134 N.Y. 461, 465, 467-468, 470; Phoenix Bridge Co. v Creem, 102 App. Div. 354, affd 185 N.Y. 580; City of Rochester v Montgomery, 72 N.Y. 65).
The duty implied by law from the acceptance of a special benefit use has been the foundation for indemnity recovery by the municipality in a large number of cases, some referring to the primary duty of the owner or the special benefit he received, others speaking the active-passive language which so long confused this field of law ( Schrold v City of New York, 273 App. Div. 872, affd 298 N.Y. 738 [special benefit]; Mazelis v Wallerstein, 51 A.D.2d 579 [primarily liable; Dole worked no change in rule]; Wylie v City of New York, 286 App. Div. 720 [special benefit duty]; Runkel v Homelsky, 286 App. Div. 110 1 [primarily liable]; Ohrt v City of Buffalo, 281 App. Div. 344, 345 [special benefit, unless city "guilty of active negligence which caused the water meter box cover to become loose"]; Nickelsburg v City of New York, 263 App. Div. 625 [special benefit]; and see Satta v City of New York, 272 App. Div. 782 [indemnity allowed with respect to shut-off valve installed by owner without statement of basis for doing so]; Gordon v City of Albany, 278 App. Div. 233, mot for lv to app den 302 N.Y. 949 [special benefit rule does not protect city against liability to injured person though it permits recovery over by city against owner]; and the 1952 Report of N Y Law Rev Comm [NY Legis Doc No. 65], at pp 41, 317).
In Schrold we affirmed over the owner's contention that the city, having failed to notify it that the drain cover was missing, was actively negligent and the owner only passively so.
The majority, nevertheless, ignoring the implied duty cases above set forth and relying upon active-passive language in four decisions (one of which, Lobello v City of New York, 268 App. Div. 880, affd 294 N.Y. 816, did not involve a special benefit appurtenance and another of which, Johnsen v Gallagher, 28 A.D.2d 560, affd 21 N.Y.2d 981, does not state whether the "condition of the sidewalk" to which it refers involved a special benefit), abolishes the special benefit-indemnity rule. To do so on the conception that Dole's abolition of active-passive reasoning justifies doing so and thus to shift to the municipality such share of the responsibility for damages as a jury sees fit to impose notwithstanding the property owner's duty, implied from acceptance of the special benefit, to maintain the appurtenance, to pay all damages resulting from his failure to do so, is truly to throw out the baby with the bath water. It is to do so, moreover, without discussion of the contrary position espoused in section 886B (subd [2], par [f]) of the Restatement of Torts, Second. Subdivision (2), which Comment d tells us lists instances in which "there is general recognition that indemnity should be granted," includes in paragraph (f) the situation in which "[t]he indemnitor was under a duty to the indemnitee to protect him against the liability to the third person." Comment j to the section explains that "The duty to protect the indemnitee from liability may arise under a contract or be imposed by statute or the common law. A typical example arises when a landowner allows a sidewalk to fall into disrepair and is required to indemnify the city when it becomes liable for injury to a pedestrian." The basis of the special benefit-indemnity obligation being the duty to protect the City against liability resulting from the appurtenance, which is spelled out by Trustees of Vil. of Canandaigua and the other cases cited above, the City is entitled to indemnity in this case. Nor can the majority find support for its position in the fact, referred to on page 458 of the opinion, that plaintiff tripped over the water shut-off cover "as she was attempting to avoid cracks in the sidewalk a short distance ahead." Though the City would be responsible for repair of such cracks, the sole question submitted to the jury was whether the fact that the water main cover was raised above the sidewalk created a dangerous condition (compare Washington Gas Co. v District of Columbia, 161 U.S. 316, 321-322), to which plaintiff's attorney took no exception. The contrary arguments in the majority's footnote (at p 463) are both irrelevant; that evidence of cracks in the sidewalk was before the jury, because that issue was not submitted to the jury by the court; that the City may have had actual notice of the defect in the appurtenance, because Trustees of Vil. of Canandaigua v Foster ( 156 N.Y. 354, 358, supra [quoted above, at p 467]) held indemnity proper nevertheless.
I have not overlooked cases such as Mahar v City of Albany ( 198 Misc. 904, affd 278 App. Div. 1003, mot for lv to app den as to city 303 N.Y. 1014; see, also, 303 N.Y. 672) and Smith v Barbaro ( 63 A.D.2d 804), which rest upon the fact that city employees negligently performed work on the appurtenance (see, also, Phoenix Bridge Co. v Creem, 102 App. Div. 354, 356, affd 185 N.Y. 580 [municipality "could only be deprived of the right of indemnity by proof that it did in fact participate in some manner in the omission beyond its mere failure to perform the duty imposed on both by the law"]). The evidence in the instant case does not even suggest such a basis for denying indemnity. Nothing in Thompson v City of New Rochelle ( 26 N.Y.2d 1047, 1049) is contrary to the rule which I find governs, for there we held only that as between the property owner and the water company which installed the water shut-off box in the sidewalk the latter "had the primary duty to correct the condition which was the proximate cause of the accident." To the contrary, that reasoning supports allowing the City indemnification here, for as between it and the property owner the latter had the primary duty to correct the offending condition.
City of Sacramento v Gemsch Inv. Co. ( 115 Cal.App.3d 869) is not authority to the contrary for the court did not there consider indemnity based upon an implied-in-law special benefit duty such as is recognized by New York case law.
The charge was: "Now, what must be shown to show that the defendant was negligent? First of all, the plaintiff must show there was a dangerous condition; a condition as a result of which someone might be injured. The specific number of inches or less than that that the water main cover was raised from the ground is not important as such. Did it constitute a dangerous condition? If you find that it did not but hasn't been shown, you will find for the defendant. That's all there is to it."
Finally, as concerns the substantive question, it should be noted that the policy of encouraging settlement of tort actions involving multiple defendants is not a sufficient reason for changing the special benefit-indemnity rule. The purpose behind the 1974 amendment of section 15-108 of the General Obligations Law was to provide "a means for encouraging settlements, while assuring that no wrongdoer is responsible for more than his equitable share of the damages incurred by the injured party" (Twentieth Ann Report of N Y Judicial Conference, 1975, p 225), but CPLR 1404 (subd [b]), adopted at the same time, also made clear the legislative intent not thereby to limit the rules governing indemnity ( id., at p 222; see, also, Nineteenth Ann Report of N Y Judicial Conference, 1974, pp 242-243). Nor is Riviello v Waldron ( 47 N.Y.2d 297) authority to the contrary, for it held only that a general release reserving rights against the employee-tort-feasor did not foreclose recovery by the injured plaintiff from the vicariously liable employer, whereas in the instant case plaintiff not only settled with the special benefit property owner but agreed to hold her harmless if "the City of New York obtains any judgment against [her] or our reading of Section 15-108 of the General Obligations Law is incorrect." Under such circumstances, there is no unfairness in holding that settlement with the owner forecloses recovery from the municipality, though as Professor David D. Siegel notes (Practice Commentaries, McKinney's Cons Laws of NY, Book 7B, CPLR C3019:60, 1981-1982 Pocket Part, pp 42-43), litigation may be necessary in order to settle the factual basis for the municipality's liability to plaintiff, which can affect its right to indemnity from the owner.
Turning now to the procedural problems with the result affirmed by the majority, I note that though plaintiff had not sued the property owner, the two of them stipulated to a settlement at the beginning of the trial. When that stipulation was put on record, the City expressly reserved all its rights against the owner should judgment be recovered by plaintiff against it. Notwithstanding that reservation, the owner's attorney then withdrew from the trial, which proceeded with only the attorneys for plaintiff and for the City present. The Trial Judge nevertheless denied the City's motion to dismiss the action because of the plaintiff's release of the owner and denied three separate requests that the jury be charged that if the City were found negligent it would be entitled to full indemnity against the owner if the jury found the shut-off valve disk to have been installed for the owner's benefit. He then compounded that error by charging that owner's duty was simply to inform the City of the unsafe condition of the box so that it could repair the condition. Whatever the proper rule concerning indemnity in special benefit cases (as to which my views are fully stated above) and whatever the propriety of denying the City's motion to dismiss, it was clear error so to instruct the jury and the error, which was objected to, cannot be deemed harmless since it bore upon the jury's apportionment of 65% culpability to the City and only 35% to the owner. At the very least, therefore, there should be a reversal and a new trial.
Though in doing so he referred to discussion before jury selection which had been made part of the record, the printed record does not reproduce the discussion or otherwise indicate the basis for the ruling. Though a settlement by the City would not affect its right to indemnity from the owner ( McDermott v City of New York, 50 N.Y.2d 211, 220), the converse is not true in the circumstances of this case for the reasons already outlined in the text above.
The record does not make clear the basis on which apportionment between the City and the nonparticipating owner was submitted to the jury, but the City's attorney repeated the exception already noted concerning the City's rights against the owner and, after the jury apportionment verdict came in, moved for judgment over in favor of the City against the owner, so the issue was clearly preserved.
For the foregoing reasons, my vote is to affirm the order of the Appellate Division, with costs, on the third-party defendant's appeal.
Chief Judge COOKE and Judges JONES, WACHTLER and FUCHSBERG concur with Judge GABRIELLI; Judge MEYER dissents in part and votes to affirm on the third-party defendant's appeal in a separate opinion in which Judge JASEN concurs.
On plaintiff's appeal: Appeal dismissed, without costs.
On third-party defendant's appeal: Order reversed, with costs, and the judgment of the Civil Court of the City of New York, New York County, reinstated.