Ferguson v. Green Island Contracting Corp. , 44 A.D.2d 358 ( 1974 )

Kane, J.

This is an appeal from an order of the .Supreme Court at Special Term, entered November 20, 1973 in Rensselaer County, which dismissed the second cause of action of plaintiff Air Cushion Vehicles, Inc. against the defendant Green Island 'Contracting Corporation.

While riding as a passenger in an airplane allegedly owned and operated by defendant Green Island Contracting Corporation (hereinafter referred to as G-reen Island) and Rensselaer County Air Park, Ine., .plaintiff, Hugo S. Ferguson, a key employee of plaintiff Air Cushion Vehicles, Inc. (hereinafter referred to as Air Cushion), sustained severe and disabling personal injuries when the plane crashed.

In the second cause of action in the complaint, plaintiff Air Cushion seeks damages from defendant Green Island for disabling its employee thereby causing it to sustain severe economic loss. Plaintiff Air Cushion also contends that the pilot of the plane was aware of the importance of Dr. Ferguson to the successful operation of its business.

The sole issue on this appeal is whether or not an employer who is deprived of the services of a key employee as a result of the negligence of some third party has a cause of action against that third party for the loss of such services.

Plaintiff Air Cushion relies on the rule enunciated in Woodward v. Washburn (3 Denio 369 [decided in 1846]). In sustaining a judgment in favor of an employer, wherein a clerk in plaintiff’s store was, during store hours, tortiously locked in a bank by the defendant, a teller in the bank, the then highest court of this 'State said (p. 374): ‘ ‘ It is enough that the relation of master and servant exists between the plaintiff and the person who is disabled or prevented from performing the service he has contracted to perform, by the tortious act of the defendant. It is not necessary, to sustain such action, to show that the person whose service has been lost by the plaintiff was either his apprentice or child. The reason and foundation upon which this doctrine is built seems to be, the property that every man has in the service of those whom he has employed, acquired by the contract of hiring, a„..d purchased by giving them wages.”

This rule was followed thereafter, but only in cases involving intentional torts (Tidd v. Skinner. 225 N. Y. 422; Lawyer v. Fritcher, 130 N. Y. 239; Bartley v. Richtmyer, 4 N. Y. 38). Although there have been some cases indicating an expansion of this rule to include recovery for mere negligence on the part of a third party (Employers’ Liab. Assur. Corp. v. Daley, 271 App. Div. 662, affd. 297 N. Y. 745; Mineral Inds. v. George, 44 Misc 2d 764), recent lower court determinations have concluded that the legal relationship contemplated in the Woodward case was based upon a relationship entirely different from that presently existing between an employer and his employee, and, thus, under more modern concepts, the third party owed no legal duty to the employer of the injured party (Myrurgia Perfumes v. American Airlines, 68 Misc 2d 712; Dotoratos v. Greenidge, 54 Misc 2d 85).

Therefore, as a question of first impression, we are called upon to decide whether a new cause of action should he recognized to protect the contractual interest of an employer in the continuation of an employee’s unimpaired services when the latter is negligently injured by expanding the scope of duty owed iby a third-party tort-feasor to encompass his victim’s employer. ■ Such a theory has been rejected in a number of other jurisdictions (cf. 53 Am. Jur. 2d, Master and Servant, §§ 402, 403; 57 C. J. S., Master and Servant, § 622; Ann. 57 ALR 2d 802; Preiser Scientific v. Piedmont Aviation, 432 F. 2d 1002, cert. den. 401 U. S. 1009). In our State the factors to be considered when a new cause of action is proposed were specifically faced in Tobin v. Grossman (24 N Y 2d 609) where the duty of a negligent party was not extended to protect the psychic well-being of parents upon physical injury to their children. The reasoning adopted by the Tobin court compels its application to this case. A reading of that decision makes it abundantly clear that, should the cause of action pleaded in this case become judicially sanctioned, it would be nearly impossible to protect against a proliferation of claims both real and fraudulent; preclude unlimited liability; avoid arbitrary distinctions in defining the areas of liability; weigh the forseeability of particular injuries; guard against unlimited or unduly burdensome liability; and cope with other related problems. The potential loss of an employee’s services is not a novel risk of harm to business. Indeed, so-called “ key man ” insurance has long existed to afford the employer some relief from that very type of risk. If that protection is inadequate or if the policies behind the weight of authority denying recovery for such negligently inflicted injuries are too narrowly based, then; in our view, a reversal of that condition should be accomplished by legislative means. “ While it may seem that there should be a remedy for every wrong, this is an ideal limited perforce by the realities of this world * * *. The problem for the law is to limit the legal consequences of wrongs to a controllable degree ” (Tobin v. Grossman, supra, p. 619). It is enough that the judiciary promotes essential justice in this area by protecting intentionally disturbed employment relationships.

. The order should be affirmed, without costs.