Coley v. Cohen , 289 N.Y. 365 ( 1942 )

On July 3, 1936, the defendant Frank L. Cohen entered into a written contract with the Buffalo Sewer Authority, a body politic created by virtue of chapter 349 of the Laws of 1935, for the construction in West Delevan avenue, between Niagara street and Elmwood avenue, of so-called Division J-Western Section of a storm water relief drain for the Bird Avenue Sewer District, the work to be performed and materials to be furnished according to specifications attached to and made a part of the contract.

This action was commenced by a property owner whose property was damaged due to concussions from blasting operations during the construction of the sewer. The complaint set up two causes of action — one based upon negligence of the contractor in connection with the blasting operations and the second based upon a clause in the contract alleged to have been made for the benefit of third persons, including this plaintiff, which was alleged to have imposed upon the contractor an absolute obligation to respond in damages for any injury to property caused by blasting operations in connection with the work. The case was neither tried nor submitted on the theory of the first cause of action but solely on the theory advanced in the second cause of action without evidence of fault on the part of the contractor. Plaintiff recovered at Trial Term and the judgment based upon the verdict of the jury in his favor was unanimously affirmed by the Appellate Division which denied an application of the defendant for leave to appeal to this court. The case reaches us by our permission.

Article I (a) of the contract provides in part: "The plans, specifications, advertisements, information for bidders, and accepted proposal, shall form a part of this contract and the provisions thereof shall be as binding upon the parties hereto as if they were herein fully set forth. * * * in case of any conflict or inconsistency between the provisions of this contract and those of the specifications, the provisions of this contract shall govern."

Article X, relating to "Contractor's Responsibility," provides that the contractor shall build, construct, finish and fully complete the whole of the specified work in the manner described and shown in the contract, drawings and specifications and in accordance with such further details and instructions as the engineer may from time to time furnish or issue for the purpose of insuring the thorough completion of the work in the most efficient manner. In that article, the contract continues: "The Contractor will indemnify and save harmless the City of Buffalo and the Authority from all claims, suits or actions and damages or costs of every name and description to which the City of Buffalo and/or the Authority may be subjected or put by reason of injury to the person or property of another resulting from negligence or carelessness on the part of the Contractor, his servants or subcontractors in the delivery of materials and supplies, or by or on account of any act or omission of his servants, agents, or subcontractors, * * *." That clause imposes liability on the contractor to indemnify the Authority and the city of Buffalo from all claims, suits or actions, damages or costs to which the Authority or the city might be subjected for injury to the person or property of another resulting from negligence or carelessness on the part ofthe contractor or from any act or omission of his servants, etc.

In subdivision 1.02 of part II of the specifications two separate and independent provisions are further made for the contractor's responsibility. The first paragraph reads as follows: "The Contractor in accepting this contract agrees to accept full responsibility for all damages and claims and for the defense of all actions against the Authority or City of Buffalo arising from any excavation made in connection with the work done under these specifications." It is clear that that provision aims to indemnify the Authority and the city of Buffalo for damages or claims and for the defense of actions against them arising fromany excavation work in connection with the contract. The clause is not inconsistent with the clause above quoted from the contract itself. It merely is more general in terms as to liability arising from excavation work than the contract clause and does not limit indemnity to possible recovery on account of the negligent acts or omissions of the contractor, his agents, servants or subcontractors, as does the clause in the contract proper. The contract provides for blasting operations. In connection with such operations, the second provision of subdivision 1.02 of the specifications reads as follows: "All blasting necessary on this contract shall be done with the express provision that the Contractor shall be and is hereunder responsible for any and all damages and claims arising from such blasting or by accidental explosions, and for the defense of all actions arising from such causes." It is under the last quoted provision of the contract that plaintiff has recovered. The claim of the defendant that the last above-mentioned provision must be construed, in the light of the contract as a whole, to protect only the city and the Sewer Authority against suits, claims or damages arising out of blasting operations cannot be sustained. On the contrary, it deals additionally with an obligation not otherwise provided for in the contract whereby the city and the Authority undertook to provide protection to third persons for personal injury and property damage arising through blasting operations where no such obligation would otherwise exist.

A reading of the contract as a whole indicates that the parties intended to and did separately provide (1) for the protection of the city and the Authority against suits, claims and damages which might arise out of negligent acts and negligent omissions of duty of the contractor or acts of his agents, servants or subcontractors in connection with the prosecution of the work, (2) for the protection of the city and the Authority from liability arising from the excavation work whether involving negligence or not, and (3) for protection of third persons against damages arising out of blasting operations and accidental explosions regardless of whether liability therefor would ordinarily exist.

The paragraph upon which reliance for recovery is based is not inconsistent with the general indemnity clause of the contract proper or with the indemnity clause relating to excavation work inserted for the benefit of the city and the Authority but is separate and distinct from those clauses and with no direct and evident contextual connection. The paragraph was unnecessary if it were intended to be limited solely to indemnity of the city and the Authority since such indemnity was separately treated and fully provided for elsewhere in the contract. By giving the words of the clause their obvious and natural meaning, violence is not thereby done to the intent of the parties expressed elsewhere in the contract.

Neither the city nor the Authority would be liable for damages to nearby property owners caused by blasting operations whether due to the negligence of the contractor or whether there was a trespass (Pack v. Mayor, 8 N.Y. 222; Herrington v. Villageof Lansingburgh, 110 N.Y. 145; Smyth v. City of New York,203 N.Y. 106), at least in the absence of evidence which does not appear in this case that the contractor engaged was incompetent and known by them to be incompetent when engaged. "* * * contracts will not be construed to indemnify a person against his own negligence unless such intention is expressed in unequivocal terms." (Thompson-Starrett Co. v. Otis Elevator Co., 271 N.Y. 36,41.) When a technical trespass arises from blasting operations, damages may be recovered from the person responsible for injury to person or property without proof of negligence. (Hay v.Cohoes Co., 2 N.Y. 159; Sullivan v. Dunham, 161 N.Y. 290.) Otherwise the law provides no remedy for such injury in the absence of proof of lack of due care on the part of the contractor. (Booth v. Rome, Watertown O.T.R.R. Co.,140 N.Y. 267; Holland House Co. v. Baird, 169 N.Y. 136.) Blasting is one of the operations provided for in the contract. The term "accidental explosion" in the clause under consideration indicates an intent to cover every situation as a result of which damage is done. As used in the contract that expression is intended to include unavoidable accidental explosions for which the contractor ordinarily would not be liable. Although under Article X (the indemnity clause), the Authority is given the right to retain money until "all suits or claims for damages shall have been settled or otherwise disposed of and evidence to that effect furnished," Article XVIII also provides for the withholding of payment "(c) to protect the Authority and the city of Buffalo from loss due to injury to persons or damage to the work or property of * * * others caused by the act or neglect of the contractor or of any of his subcontractors." The contractor is required to procure and continue during the life of the contract public liability and property damage insurance sufficient not only to protect the city and the Authority but also to protect him and any subcontractor from claims for damages for personal injury, including wrongful death, and claims forproperty damage which may arise from operations under thecontract whether such operations are conducted by himself or by a subcontractor or by anyone directly or indirectly employed by either. Those clauses were designed to be broad enough to provide protection to the contractor and to the city and to the Authority severally as against claims, suits and damages arising from injury to nearby property from blasting operations although no liability to third persons for such injury would ordinarily exist.

We conclude, therefore, that, not only by the express wording of the provision of the contract upon which plaintiff relies for recovery but also by the clear intent of the parties as indicated by an examination of the contract taken as a whole, the clause dealt with an independent subject and created an obligation on the contractor in favor of third parties to respond to them for damages to their property in connection with blasting operations although no liability on the part of the contractor to them would otherwise exist. Nothing novel appears in the language of the clause and the provision is not unusual in contracts for public improvements. Of similar wording and purpose are commonly found similar clauses in present day public improvement contracts without providing indemnity of the principal or requiring negligence of the contractor as a necessary basis for recovery. In the public interest it was competent for the parties to so contract (Rigney v. N.Y.C. H.R.R.R. Co., 217 N.Y. 31) and when such a provision is found a third party beneficiary may maintain an action on the agreement. (Coster v. Mayor,43 N.Y. 399; Wilson v. Costich Co., 256 N.Y. 629; Trumpbour v.Johnson Corp., 277 N.Y. 609.)

The judgment appealed from should be affirmed, with costs.