United States: Death And Liability

Last Updated: May 17 2017
Article by Matthew Siegal and Dale J. Degenshein

Originally published in Habitat Magazine in June 2017.

A CONTRACTOR DIES on the job. Who's liable?

When shareholders perform work in their apartments, the concept is that the shareholder assumes all risk and liability in connection with that work. In other words, the coopera¬tive corporation is not responsible for any damage or injury. Those principles are embedded in alteration agreements.

However, there are certain statutes, such as Labor Law Section 240, com¬monly known as the "Scaffold Law," that make building owners liable for certain construction injuries, regard¬less of the owner's actual involve¬ment in the work. And even though a cooperative corporation is not a tradi¬tional building owner, these laws do apply and a cooperative will be held liable. Importantly, contributory neg¬ligence doesn't count. So, if a worker is partly at fault, it cannot be used to defend the claim.

Which brings us to the case of Domaszowec v. Residential Management Group LLC. Shareholders of the cooperative at 40 Fifth Avenue contracted to have their windows washed. While doing that work, win¬dow washer Robert Domaszowec fell 13 stories to his death when the anchor/hook to which his harness was attached dislodged. Could this accident have been avoided? And just as important: who was liable?

The window was one of twelve that had recently been replaced by the shareholders. The anchor bolts seemed to have been cut while the window replacement work was under¬way. Everyone agreed that the share¬holders did not know of the damaged or defective anchor bolts. But these new windows swivel inward. As a result, they could have been cleaned from inside the apartment. Should the shareholder have told the window washer that cleaning from the exterior was unnecessary?

The court said that although it "may have been salutary" to do so, the shareholder had no duty to inform Domaszowec. He was an experienced window washer, so the shareholder may have believed there was no reason to tell him about the tilt feature. Moreover, he had cleaned other windows in the building from inside apartments, so he presum¬ably knew there was another, safer, way to do the job. The lower court decided there was an issue of fact as to Domaszowec's own negligence; however the appellate court did not review these issues.

The lower court utilized basic neg¬ligence theories and concluded that, as the building owner, the co-op had responsibility for the inspection, main¬tenance, and repair of the building's facade, including the anchor bolts. In addition, there are Department of Buildings (DOB) rules concerning maintenance of those bolts, which were violated by the co-op. The lower court concluded that violation of the DOB rule itself was evidence of neg¬ligence, so the claim against the co-op would not be dismissed.

The appellate court relied on the Scaffold Law, which, among other things, requires owners of buildings to furnish devices such as the anchor bolts "constructed, placed, and operated as to give proper protection to a person" who will use them. Accordingly, the co-op was found to have violated the statute even though it had not hired Domaszowec or the contractor who installed the new windows. However, the shareholders in the unit where the accident happened were not liable under the statute because they were not the "owners" of the building.

Neither court discussed the window replacement in great detail, nor did they discuss whether the co-op's engi¬neer should have inspected the facade after the shareholders' contractor installed the windows. Would an engi¬neer have discovered the cut anchor bolts, so that they could have been immediately repaired? As this accident makes clear, it is crucial that coopera¬tives remain vigilant in exercising their right to inspect a shareholder's work, at the shareholder's expense. It is important to remember that sharehold¬ers often perform work that affects the facade or building systems.

And that work should be diligently reviewed. If it isn't, you could end up paying hefty sums. After this deci¬sion, the case was settled for $9 mil¬lion, $2.6 million of which was paid by the cooperative.

We do not know how much of that sum was paid by the co-op's insurance carrier. However, it is imperative that cooperatives have their insurance reviewed regularly not only by the broker but also by a risk management specialist, who brings an added level of expertise to the process.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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