author: Alexander, J. Hancock, Jr., J.

text:
    The People of the State of New York, Respondent, v Michael W. Hults, Appellant.
    Argued March 21,1990;
    decided May 10, 1990

      POINTS OF COUNSEL

      Martin I. Saperstein for appellant.

      Denis Dillon, District Attorney (Lawrence J. Schwarz and Bruce E. Whitney of counsel), for respondent.
   OPINION OF THE COURT

Alexander, J.

We established in People v Hughes (59 NY2d 523) that posthypnotic testimony, to the extent it is affected by the prior hypnosis, is not admissible as evidence-in-chief because of its inherent unreliability. Implicit in our decision in Hughes is the conclusion that statements made during the hypnotic procedure are also inadmissible on direct examination, at least to the extent they differ from the subject’s prehypnotic statements. We hold today that such hypnotic statements are, as a general rule, also inadmissible for purposes of impeachment. Moreover, the application of this general rule to a criminal defendant who conceded the unreliability of the hypnotic statements he seeks to use for impeachment is not barred by any constitutional considerations. Accordingly, the statements made by the complainant during her hypnotic procedure were properly excluded at defendant’s trial. Thus, we affirm the order of the Appellate Division upholding his conviction.

I

The trial testimony established that on Saturday March 27, 1982 in Floral Park, defendant, while driving a large, white, four-door car with a black vinyl roof, offered the complainant a ride. She accepted, initially intending to be taken to a nearby bus stop, but thereafter accepting defendant’s offer to take her a few blocks further. The complainant described the defendant as a man of medium build, "medium to fair-skinned”, "scruffy” or unshaven, and with blondish hair and blue eyes. According to the complainant, defendant wore a blue gas station uniform with an Exxon patch sewn on it, had greasy hands and fingernails and smelled of liquor. As they drove, defendant told the complainant that he worked at an Exxon station in Elmont and that he had attended, but had not graduated from, Carey and Van Burén High School. Defendant also stated that he was divorced and had two children, a seven-year-old son and a two-year-old daughter. The complainant noticed a baby seat in the backseat of the car. Finally, defendant drove into an empty parking lot where he sodomized the complainant at knifepoint. The entire incident lasted approximately 35 to 40 minutes. After she was released, the complainant called her aunt and uncle, who notified the police.

Defendant was arrested approximately three months later when observed by the police in his girlfriend’s white, four-door Ford Torino with a black vinyl roof and a baby seat in the back. At the time, defendant had a moustache and was wearing a blue shirt with an Exxon patch. After waiving his Miranda rights, defendant stated that he worked at an Exxon station in West Hempstead, that he lived in Floral Park, that he had worked on the day of the crime and that on his usual route to and from work he drove by the intersection of Plainfield Road and Jericho Turnpike where the complainant had been picked up. Defendant also told the police that he had attended, but not graduated from, Carey and Van Burén High School and that he was divorced and had two children — a son and a daughter. On the day of his arrest, the complainant identified the defendant’s voice and also identified him in a lineup, notwithstanding that she had never described her attacker as wearing a moustache. Defendant was subsequently indicted.

At defendant’s arraignment, defense counsel was advised that as part of the police investigation, the complainant had undergone hypnosis approximately three weeks after the crime. After arraignment, but prior to trial, this court decided People v Hughes (59 NY2d 523, supra), holding a witness’ testimony inadmissible to the extent it was influenced by prior hypnosis, and People v Tunstall (63 NY2d 1), holding that a defendant was entitled, upon motion, to a hearing to determine the admissibility of testimony of a previously hypnotized witness. At no time prior to trial, however, did defendant move for a Hughes-Tunstall hearing to determine whether the complainant’s proposed testimony was affected by her prior hypnosis. Complainant testified at the trial and, although he had not moved for a Hughes-Tunstall hearing, defendant sought to impeach the complainant’s trial testimony with inconsistent statements she made while under hypnosis. The most significant inconsistency defense counsel sought to reveal was that while at trial the complainant could recall only that her assailant’s blue shirt had the name "Exxon” on it, when under hypnosis, she had stated that her assailant’s shirt bore the name "Billie”. Other evidence at trial established that the defendant’s work shirts had only his own name, "Mike”, on them. County Court sustained the prosecutor’s objection to this possible use of the complainant’s hypnotic statements, reasoning that the rule of People v Hughes (supra) prohibited the admission of such testimony whether on direct or cross-examination. Defendant was convicted of sodomy in the first degree.

The Appellate Division reversed, for reasons unrelated to this appeal, and ordered a new trial (People v Hults, 122 AD2d 857). That court noted, however, that at the new trial, the defendant could not seek to impeach the complainant with her prior statements made under hypnosis.

More than four months later, defense counsel sought a Hughes-Tunstall hearing to determine if the complainant’s proposed trial testimony was affected by her prior hypnosis. County Court denied the application, noting that defense counsel had been aware of both the facts and the law relating to the complainant’s hypnosis well before the first trial but had not then sought such a hearing. The court declined to exercise its discretion to excuse counsel’s delay in seeking the hearing (see, CPL 255.20).

Prior to the second trial, the prosecutor revealed that any videotape or other record of the complainant’s hypnotic procedure had been inadvertently lost in the five years since the procedure had been conducted. The prosecutor also noted the possibility that a preinduction statement had been taken from the complainant prior to her hypnosis and that such a statement, if it existed, was lost as well. Defendant, in effect, renewed his Hughes-Tunstall motion, seeking to preclude the complainant’s trial testimony because the loss of the records of the hypnotic session made it impossible for the People to demonstrate that her trial testimony was not affected by the pretrial hypnosis and, alternatively, moved to preclude the complainant from testifying to posthypnotic recollections. Both motions were denied, although the trial court ruled that defendant could litigate the Hughes issue at trial. Thus, the parties stipulated that the records of the complainant’s hypnotic session were irretrievably lost through no fault of the District Attorney’s office. At the close of the People’s case, defendant moved for a trial order of dismissal, arguing that the People had failed to establish, by clear and convincing evidence, that the complainant’s trial testimony was unaffected by her prior hypnosis. The motion was denied, and, on his direct case, defendant presented expert evidence of the unreliability of hypnosis and argued that without a proper record of the complainant’s hypnosis, it was impossible to tell to what extent her testimony was affected by the prior hypnosis. In addition, defendant again sought to impeach the complainant’s trial testimony by introducing her prior hypnotic statements. County Court denied the application, ruling that the Appellate Division determination of the issue on the prior appeal was the law of the case. Prior to summations, defendant moved to strike the complainant’s testimony on the ground that the loss of her preinduction statement violated People v Rosario (9 NY2d 286). The prosecutor represented that it was not known whether a preinduction statement had ever been taken in this case and County Court denied the motion. Finally, on summation, defendant argued the unreliability of statements made as a result of improper hypnotic procedures. He urged the jury to discredit the complainant’s identification of the defendant, contending that the identification was the product of suggestion or confabulation caused by the hypnosis.

Defendant was again convicted of sodomy in the first degree. The Appellate Division affirmed and defendant appeals by leave of an Associate Judge of this court.

Defendant’s primary contentions on this appeal are that County Court abused its discretion in denying his application for a Hughes-Tunstall hearing and that the court’s ruling precluding his use of the complainant’s hypnotic statements for impeachment unconstitutionally restricted his cross-examination of her.

We now affirm.

II

We reject defendant’s contention that County Court abused its discretion in denying his belated application for a Hughes-Tunstall hearing. Defendant has made no showing of good cause for his failure to bring the motion either before the first trial or even within 45 days of the Appellate Division order directing a new trial (see, CPL 255.20). Defense counsel was advised of the complainant’s hypnosis at defendant’s arraignment and is chargeable with knowledge of our decisions in People v Hughes (supra) and People v Tunstall (supra) at the time they were decided — months before the first trial. By failing to timely request a Hughes-Tunstall hearing to determine the admissibility of the complainant’s proposed trial testimony, defendant has waived the issue (People v Key, 45 NY2d 111, 116).

The novel question presented on defendant’s appeal is whether the general rule articulated in People v Hughes (supra) may be extended to preclude defendant’s use of the complainant’s hypnotic statements on cross-examination. Defendant contends that the rule of Hughes is limited to the introduction of hypnotic statements or statements affected by a prior hypnosis on the direct case, and therefore has no bearing upon the use of hypnotic statements for cross-examination. In any event, defendant urges, the State cannot constitutionally restrict his cross-examination of a prosecution witness by precluding his use of such hypnotic statements.

In People v Hughes (59 NY2d 523, 543, supra) we held inadmissible as direct evidence posthypnotic testimony affected by the hypnosis because hypnosis was not, at that time, generally accepted as reliable in the scientific community (see also, People v Shedrick, 66 NY2d 1015; People v Allweiss, 48 NY2d 40; People v Leone, 25 NY2d 511; Frye v United States, 293 F 1013). We explained that hypnosis was not a reliable method of refreshing recollection because the hypnotic procedure is inherently suggestive and affects the subject in at least three ways: (1) the subject may be susceptible to suggestions given intentionally or unintentionally by the hypnotist or others present during the session; (2) the subject may confabulate or intentionally fabricate events in order to fill in memory gaps; and (3) a witness who has been hypnotized may experience an enhanced confidence in his or her memory of an incident, thereby unfairly impairing a defendant’s ability to cross-examine the witness about the event (People v Hughes, 59 NY2d, at 534-535; People v Tunstall, 63 NY2d 1, 7, supra). Implicit in Hughes is the conclusion that statements made during the hypnosis itself are inadmissible on direct, at least to the extent that they differ from the witness’ prehypnotic statements. As with hypnotically refreshed recollections, the unreliability of such hypnotic statements has been well documented (see, e.g., Beaudine, Growing Disenchantment With Hypnotic Means of Refreshing Witness Recall, 41 Vand L Rev 379, 400-405 [citing scientific studies]).

Defendant has not submitted any evidence that the consensus within the scientific community as to the unreliability of hypnosis has changed since our decision in Hughes and thus tenders no basis for us to reconsider our determination that posthypnotic testimony, to the extent affected by the hypnosis, is not admissible as evidence-in-chief. Moreover, we see no reason in this case to limit the rule of Hughes to permit a litigant to introduce on cross-examination, even for the limited purpose of impeachment, hypnotic statements which are inadmissible on direct. In either situation, the probative value of the hypnotic statement is directly related to its reliability. The first two dangers of hypnosis recognized in Hughes— suggestion and confabulation or fabrication — relate to all hypnotic statements, whether they are sought to be introduced as evidence-in-chief or as prior inconsistent statements for the purpose of impeachment.

It is true, as defendant argues, that some evidence which is inadmissible as evidence-in-chief is nevertheless admissible on cross-examination. Thus, prior inconsistent statements, which might be inadmissible hearsay if introduced on direct, are admissible for impeachment because placing the inconsistency before the jury serves the truthtesting function of cross-examination which is integral to our adversary system (see generally, McCormick, Evidence § 34 [3d ed]; Richardson, Evidence §§501, 502 [Prince 10th ed]). However, a prior statement which is involuntarily made is inherently unreliable and totally lacking in probative value. Such a statement cannot serve this truthtesting function, even if used only for the limited purpose of impeachment. Thus, a statement actually coerced from a defendant is inadmissible for all purposes (Mincey v Arizona, 437 US 385, 399). By contrast, a defendant’s statement, voluntarily made but obtained in violation of Miranda v Arizona (384 US 436), is inadmissible on the prosecution’s direct case but may nevertheless be used for impeachment where "the trustworthiness of the evidence satisfies legal standards” (New York v Harris, 401 US 222, 224, affg 25 NY2d 175; see also, People v Washington, 51 NY2d 214). While these cases arise in the context of protecting a defendant’s right to due process and the privilege against self-incrimination, the rule serves the truthtesting function of cross-examination by permitting a statement, which is trustworthy at least to the extent it is voluntary, to be used for impeachment (New York v Harris, 401 US, at 225-226).

A hypnotic statement, however, may be the product of suggestion or confabulation and thus not fairly the witness’ own. Even if such a statement is inconsistent with a witness’ trial testimony, because of the statement’s unreliability, the inconsistency simply is not probative of the truth or falsity of the witness’ subsequent trial testimony. Thus the fact that the statement is not offered "assertively”, for its own truth (see, dissenting opn, at 202), is beside the point. Such a hypnotic statement, even when offered solely for the purposes of impeachment, may properly be excluded.

That determination, however, does not end the inquiry. Notwithstanding the general rule of Hughes precluding the use of hypnotically induced testimony on direct, a necessary exception exists when a criminal defendant testifies in his own defense. In Rock v Arkansas (483 US 44, 61), the Supreme Court held that a State’s per se rule prohibiting the admission of posthypnotic testimony could not be applied to all criminal defendants seeking to testify in their own defense absent some consideration of whether indicia of reliability supported the admission of the hypnotic statements. Significantly, the court recognized the State’s legitimate interest in excluding unreliable evidence such as hypnotic statements, but held that the State could not preclude a defendant’s testimony to such statements without proving the unreliability of the statements sought to be offered (id.). A sufficient demonstration of the unreliability of a defendant’s hypnotic statement in a particular case, however, would justify exclusion of the testimony (id.).

The right to cross-examination, like the right to present evidence, is integral to our adversary trial process and a fundamental right secured to a criminal defendant by the Confrontation Clause of the Sixth Amendment (Lee v Illinois, 476 US 530, 540; Davis v Alaska, 415 US 308, 315-316; Pointer v Texas, 380 US 400, 404; see also, People v Cintron, 75 NY2d 249). It is argued therefore, that a defendant’s right of cross-examination may not be arbitrarily infringed by a per se rule of evidence excluding the use of hypnotic statements to impeach a prosecution witness. On the other hand, unlike the relevant testimony to be proffered by a criminal defendant, the scope of cross-examination is within the sound discretion of the Trial Judge (Delaware v Van Arsdall, 475 US 673, 678; People v Coleman, 56 NY2d 269, 273) and like the exclusion of a physically coerced statement (Mincey v Arizona, supra) the exclusion of an inherently unreliable hypnotic statement may be within the Judge’s discretion.

We need not resolve the issue in this case, however, because even assuming that the Constitution requires an exception to the general exclusion of hypnotic statements, it is clear that the State may constitutionally exclude hypnotic statements which have been demonstrated to be unreliable (Rock v Arkansas, 483 US, at 61, supra). This defendant, at his second trial, conceded the unreliability of the complainant’s hypnotic statements. In an effort to undermine her trial testimony, defendant presented expert evidence to the jury to demonstrate the suggestiveness of hypnotic procedures and argued that without a videotape of the hypnotic session, it was impossible to determine the extent to which her trial testimony was tainted by the prior hypnosis. Having argued that the complainant’s hypnotic statements are unreliable as the product of an inherently suggestive procedure, defendant was not free to introduce some of those same hypnotic statements for the purpose of impeachment.

We have reviewed defendant’s remaining contentions to the extent they have been preserved for our review and conclude that they are without merit.

Accordingly, the order of the Appellate Division should be affirmed.

Hancock, Jr., J.

(dissenting). Defendant was convicted on the testimony of one witness: the complainant. The defense at trial was misidentification and the complainant’s hypnotic statement was critical to it. The descriptions of the assailant given by the complainant, both at the police station and in her trial testimony, did not completely fit defendant, and the description she gave while under hypnosis was plainly exculpatory. The trial court barred defense counsel from using the complainant’s hypnotic statement to impeach her, and the majority of our court now upholds that ruling on the ground that, under our prior decisions, hypnotically produced recollections are inherently unreliable. Because, in my view, defendant’s State and Federal constitutional rights to confront adverse witnesses were unduly restricted on the basis of an erroneous evidentiary ruling, I dissent.

I

In complainant’s statements to the police, as well as in the composite sketches drawn by a police artist and herself, the assailant was depicted as clean-shaven; in fact, at all relevant times, defendant wore a distinctive moustache. The assailant’s hair was portrayed as reaching his collar; but there was proof at trial that he didn’t wear his hair that long. The assailant was described as wearing a shirt bearing only the name "Exxon”; but the undisputed proof was that defendant’s workshirts all bore his name, "Mike H.”. And, most significantly, in her hypnotically produced statement, the complainant said that she did see a name on the assailant’s shirt, and that it was "Billie”.

That hypnotic statement would have underscored the disparities between the complainant’s pretrial descriptions of her assailant and defendant’s actual appearance; more than that, it would have added another particularly significant discrepancy — the assailant’s name. The trial court’s ruling, that the hypnotically produced description of the assailant could not be used, deprived defendant of a crucial prior inconsistent statement with which to impeach the complainant on cross-examination, and, thus, seriously curtailed his constitutional confrontation rights. While those rights are certainly not absolute (see, People v Cintron, 75 NY2d 249, 259; Delaware v Van Arsdall, 475 US 673, 679), the arguments made to justify the trial court’s ruling in this case do not withstand scrutiny.

The People contend that our decisions in People v Hughes (59 NY2d 523) and People v Tunstall (63 NY2d 1) declared hypnotic statements to be inherently unreliable and, thus, dictate the inadmissibility of any such statement, regardless of the purpose — whether by the People to prove their case-in-chief or, as here, by the defendant to impeach the prosecution witness who uttered it. This position, now adopted by the majority (see, majority opn, at 197), misconstrues those decisions, contravenes established rules governing the use of prior inconsistent statements, and, moreover, interferes with a basic trial right of a criminal defendant without sufficient justification.

II

In Hughes, we held that a rape victim’s hypnotically produced recollections — i.e., recollections occurring during the hypnotic procedure or coming to mind for the first time thereafter — could not be used by the prosecution as evidence to convict the defendant. The basis for our decision was not that such hypnotically produced recollections, themselves, were invariably false or unreliable. Rather, the basis was simply that there is, as yet, no sure way of determining whether such hypnotically produced recollections reflect the subject’s actual memory of events, as opposed to confabulations or fictitious recollections suggested during the procedure itself.

Our decision in Hughes rested solely on whether "hypnosis has gained general acceptance in the scientific community as a reliable means of restoring recollection” (59 NY2d, at 543); our answer was just as specific: "at the present time hypnosis has not achieved that status” (id.). While hypnotically produced memories can be accurate and reliable, we held that hypnotically produced recollections could not be permitted as a basis for convicting a defendant because science has yet to devise a way of separating true recollections from the false. And while we firmly rejected the use of such recollections against a defendant because of this uncertainty in their probative value (id., at 542-544), we never suggested that those recollections should be barred for all purposes — let alone for the impeachment of a previously hypnotized prosecution witness by the defendant, the very person sought to be protected by the guidelines adopted in Hughes (see, id., at 545-548).

Neither was any such prohibition suggested in Tunstall. Rather, in that case, we established the requirement for a pretrial hearing to determine whether the confidence of a prosecution witness in her prehypnotic recollections was artificially enhanced by the hypnotic process (63 NY2d, at 8-9). Significantly, our court made clear that the particular purpose for the safeguards in Tunstall, as for those in Hughes, is to ensure that "there has been no substantial impairment of the defendant’s ability to meaningfully cross-examine” a previously hypnotized witness (id., at 9). Surely, our holdings in those cases were never intended to restrict a defendant’s right to cross-examine such a witness. It is, at best, incongruous that those decisions should now be invoked in support of such a purpose.

But even assuming that Hughes and Tunstall could somehow be read as declaring that hypnotically produced recollections themselves are invariably unreliable, that would still not lead to the conclusion, drawn by the majority, that such recollections may not be used by a defendant for the sole purpose of impeaching the credibility of a prosecution witness who has made a prior inconsistent hypnotic statement. It is basic that the purpose of using a prior inconsistent statement on cross-examination is not to prove the facts contained therein (Richardson, Evidence § 501 [Prince 10th ed]). It is not offered for its truth; its reliability as an assertion of the truth is entirely beside the point (id.; 3A Wigmore, Evidence § 1018 [a] [Chadbourn rev]). Indeed, in most jurisdictions, including New York, it is the duty of the trial court to instruct the jury that a prior inconsistent statement has no independent testimonial value (see, e.g., People v Freeman, 9 NY2d 600; Matter of Roge v Valentine, 280 NY 268; see, CPL 60.35; 3A Wigmore, op. cit., § 1018 [b]).

Thus, a prior inconsistent statement is not used "assertively”. The fact finder is not asked to believe it, or even to choose between it and the contrary trial testimony (see, 3A Wigmore, op. cit., § 1018 [b]). Rather, the prior statement and the trial testimony are merely set against each other. The very fact that the witness necessarily erred in making one or the other — because both cannot be true — tends to undermine the witness’s credibility. In short, it simply makes no difference whether the prior inconsistent statement, when used as such, has any basis in truth. Hence, under settled rules, there is no basis for excluding a prosecution witness’s prior hypnotic statement, even if it is deemed unreliable as an assertion of fact, where it is offered solely for impeachment on the basis of its inconsistency.

The Supreme Court’s decision in Mincey v Arizona (437 US 385) in no way supports the opposite conclusion. There, the court barred the use of an involuntarily obtained confession to impeach the defendant, but not because of the confession’s unreliability (see, majority opn, at 198). The court never made a finding of unreliability; rather, it found only that defendant had not wished to answer police inquiries and that his "will was simply overborne.” (437 US, at 401-402.)

The court precluded the use of the confession, not because of any lack of probative value, but because of the core due process violation involved. Of course, as the Mincey court reminded us, where the "prophylactic” strictures of Miranda v Arizona (384 US 436; see, New York v Quarles, 467 US 649, 654) are violated, a defendant’s confession will still be admissible if its " 'trustworthiness * * * satisfies legal standards.’ ” (437 US, at 398, quoting Harris v New York, 401 US 222, 224.) But the court made clear that trustworthiness is irrelevant where the confession is truly involuntary. '[A]ny criminal trial use against a defendant of his involuntary statement,” the court emphasized, "is a denial of due process of law” (id. [emphasis in original]).

Hence, Mincey hardly stands for the proposition that an unreliable past statement may not be used to impeach a prosecution witness who uttered it. Instead, that decision underscores the proposition that the basic trial rights of an accused must be guarded with the utmost vigilance. The majority of this court now uses Mincey to support the totally antithetical proposition that a defendant’s right to cross-examine an adverse witness must be limited due to the possible unreliability of that witness’s prior statement.

As the Supreme Court has frequently observed, "the right of confrontation and cross-examination is an essential and fundamental requirement for the kind of fair trial which is this country’s constitutional goal” (Pointer v Texas, 380 US 400, 405; see also, Lee v Illinois, 476 US 530, 540). The ability of a criminal defendant to cross-examine adverse witnesses is "primarily a functional right that promotes reliability in criminal trials.” (Lee v Illinois, supra, at 540 [emphasis added].) Because of the importance of confrontation rights to our system of justice in providing an effective safeguard against false or questionable accusations (see, id.), both our court and the Supreme Court have insisted that they not be infringed unless compelled by some strong State interest (see, People v Cintron, supra, at 258-259; Delaware v Van Arsdall, supra, at 679). Such an interest is entirely absent here.

Even if, as the majority holds, hypnotically produced recollections are necessarily unreliable and prior inconsistent statements which are unreliable cannot generally be used for impeachment, still, that cannot justify the trial court’s ruling in this case. It hardly provides a compelling reason for denying a criminal defendant the opportunity to confront a prosecution witness with her hypnotic statement which not only conflicts with her trial testimony, but also exculpates the defendant. At the least, something more than an evidentiary rule of general application is necessary to limit the exercise of a basic trial right.

Hence, in Chambers v Mississippi (410 US 284), the Supreme Court invalidated the application of a state’s hearsay rule that restricted the defendant’s right to present witnesses on a matter critical to his defense. And more recently, in Rock v Arkansas (483 US 44), the court held that the state’s rule barring hypnotically refreshed testimony could not be used to infringe upon the defendant’s right to testify in his own behalf. A state’s evidentiary rule must " 'not be applied mechanistically to defeat the ends of justice,’ ” the court warned, "but must meet the fundamental standards of due process.” (Id., at 55, quoting Chambers v Mississippi, supra, at 302.) Those standards are violated, in my view, when the rules our court adopted in Hughes and Tunstall, to prevent a prosecutor’s use of potentially unreliable hypnotic recollections to obtain convictions, are applied against a defendant, to interfere with his right of cross-examination — here, defendant’s right to cross-examine the complaining witness about a prior inconsistent and exculpatory statement regarding the assailant’s identity, the sole issue at trial.

Ill

I would hold that the trial court erred in refusing to allow defendant to cross-examine complainant on the basis of her inconsistent hypnotic statement. The court’s refusal was particularly ironic here where it also ruled that the prosecution could use ’ complainant’s posthypnotic recollections against defendant, even though he was not permitted to test those recollections in a Hughes-Tunstall hearing.

But the ironic effect of this ruling is magnified by a curious position taken in the majority opinion. Because defendant attempted to undercut complainant’s posthypnotic testimony by adducing expert evidence concerning the possible taint from the hypnosis, he is now held to have "conceded the unreliability of the complainant’s hypnotic statements” (majority opn, at 199) — and, presumably, also to have "conceded” that they could not be used by him for the purpose of cross-examination. It is unclear whether a defendant may use the complainant’s hypnotic statement for cross-examination only if he foregoes expert proof on the effect of hypnosis on the complainant’s direct testimony. The majority opinion does seem to advance this singular proposition, however, and uses it with telling effect on defendant here.

In short, the People were allowed to convict defendant on the basis of testimony which might have been tainted by hypnosis. Defendant, on the other hand, was deprived of his right to cross-examine the complainant by using a hypnotic statement which, for all that is known, might have been entirely accurate and trustworthy.

For these reasons, I believe it was error to restrict the exercise of defendant’s confrontation rights by denying him the use of complainant’s prior inconsistent hypnotic statement

on cross-examination; I would reverse the order of the Appellate Division, vacate defendant’s conviction and order a new trial.

Chief Judge Wachtler and Judges Simons, Kaye and Bellacosa concur with Judge Alexander; Judge Hancock, Jr., dissents and votes to reverse in a separate opinion in which Judge Titone concurs.

Order affirmed.

      . In Hughes, we had also held that a subject’s prehypnotic recollections —i.e, what the subject recalled of the actual events before submitting to the hypnotic procedure — could be adversely affected by a subsequent hypnotic procedure (59 NY2d 523, 545-548). The subject’s confidence in the accuracy of her prehypnotic recollections could be enhanced, thereby making it more difficult to cross-examine her effectively. We held, nevertheless, that a subject should be permitted to testify against a defendant in a criminal trial concerning such prehypnotic recollections provided that the court has first determined in a hearing that the prehypnotic recollections were not enhanced or otherwise affected by the subsequent hypnosis (id., at 547-548).

      . Because no hearing was held, there is no way of knowing whether "the victim’s prehypnotic recollections were not 'unduly influenced by the hypnotic sessions’ ” (People v Hughes [II] 72 NY2d 1035,1037). Also, and of equal importance, without a hearing the extent of the victim’s prehypnotic recollections — and the boundary of admissible testimony — was not established (id., at 1037). Thus, it cannot be determined whether defendant was convicted either on the basis of fictitious or confabulated recollections or prehypnotic recollections which were tainted by the subsequent hypnosis.

      . It should be noted that the court in denying defendant’s motions with respect to the Hughes-Tunstall hearing and for a preclusion of the victim’s testimony, specifically provided as a condition of its denial that it would "certainly permit [defendant] to introduce evidence from [his] expert on hypnosis.” (Trial minutes, at 51.) It seems anomalous that defendant’s decision to avail himself of this permission should now be held against him.


source: Caselaw Access Project

author: Hancock, Jr., J.

license: Public Domain

text:
    Brian Hoxie’s Painting Company, Inc., Appellant, v CatoMeridian Central School District, Respondent.
    Argued March 29, 1990;
    decided May 10, 1990

      POINTS OF COUNSEL

      James J. Wallace for appellant.

      Raymond S. Sant for respondent.
   OPINION OF THE COURT

Hancock, Jr., J.

Plaintiff was required to pay its employees approximately $6,000 in additional wages and supplements for having failed to pay the prevailing wages, dictated by Labor Law § 220, while performing a work contract for defendant school district. It brought this action seeking to recover that amount from the school district on the ground that the school district, in soliciting bids for the contract, had failed to give notice of the applicable prevailing wages as required by Labor Law § 220-d. Supreme Court dismissed the complaint and the Appellate Division affirmed, holding that, although Labor Law § 220-d applies to school districts, a contractor has no cause of action against a school district for failure to comply with the statute’s notice requirements. We agree.

I

In July of 1983, defendant solicited bids on a contract to paint the cupola, cornice and windows at the Cato-Meridian Middle School; its advertising specifications, however, contained no notice of the prevailing wage requirements. Plaintiff, who had received an invitation, submitted a bid in the amount of $9,280, allegedly based on an estimated $1,080 in materials and $8,200 in labor costs computed on plaintiff’s customary pay rates. It submitted the lowest bid, and defendant awarded it the contract in accord with General Municipal Law § 103.

Subsequently, the State Department of Labor ordered defendant to withhold $7,400.26 from the contract price because plaintiff failed to pay its employees prevailing wages (see, Labor Law § 220) and, thus, plaintiff received only $1,879.74 upon completion of the work. After stipulating that its employees were due an additional $5,920.21 in wages and supplements, plaintiff commenced this action seeking recovery of that amount, alleging that defendant’s failure to give notice of the prevailing wage requirements, as mandated by Labor Law § 220-d, was the cause of its damages. Upon defendant’s motion, Supreme Court dismissed the complaint for failure to state a cause of action, and a divided Appellate Division affirmed, relying on its decision in Williamson Roofing & Sheet Metal Co. v Town of Parish (139 AD2d 97) for the proposition that there is no private cause of action for another’s failure to satisfy the notice requirements of section 220-d. We now affirm.

II

The threshold issue is whether Labor Law § 220-d applies to a school district. In pertinent part, section 220-d provides: "The advertised specifications for every contract for the construction, reconstruction, maintenance and/or repair of public work to which the state, county, town and/or village is a party shall contain a provision stating the minimum hourly rate of wage which can be paid and the minimum supplement that can be provided * * * to the laborers * * * employed in the performance of the contract * * * and the contract shall contain a stipulation that such laborers, workingmen or mechanics shall be paid not less than such hourly minimum rate of wage and provided supplements not less than the prevailing supplements.” (Emphasis supplied.) Defendant argues that because it is a municipal corporation, and not "the state, county, town and/or village”, section 220-d does not apply to it. The Appellate Division panel was unanimous in rejecting that contention and so are we. The statutory scheme of article 8 of the Labor Law in which section 220-d is contained, as well as the legislative history, refutes the district’s constricted reading of the statute.

Article 8 of the Labor Law, of which section 220-d is a part, is entitled "Public Work” and implements the State constitutional requirement that laborers engaged in the performance of a public work be paid prevailing wages (see, NY Const, art I, § 17; see, Matter of Golden v Joseph, 307 NY 62, 67). Section 220 of the Labor Law sets forth the hours, wages and supplements to paid laborers on public works and expressly includes work performed for municipal corporations (see, Labor Law § 220). The district concedes that the prevailing wage requirements apply to work contracts it enters, but argues that, because the notice provisions of section 220-d do not expressly apply to municipal corporations, it is not bound by the statute to comply with them. This construction is inconsistent with the legislative history and purpose of section 220-d.

Section 220-d of the Labor Law, when first enacted, applied only to highway projects (see, Mem of State Industrial Commr to Governor, Bill Jacket, L 1933, ch 733 ["(t)he effect of this bill is to place all competitors for highway construction projects on an equal basis as affects the wages for common labor”]). The statute expressly applied to contracts entered into by the "state, county, town and/or village”, presumably because these were the only public entities engaged in highway construction. In 1934, however, article 8 was expanded to include all types of "public work” and the statute was amended to replace the reference to "highway construction” with "public work” (L 1934, ch 747). The legislative history surrounding this amendment is not detailed, but the basic purpose of the bill is evident: "Based on the experience of this Department [of Labor] an amendment is herewith presented to eliminate the restriction of the payment of this hourly rate of wage to highways and extending it to laborers on all public work construction * * * We know of no reason why laborers on highway work should receive a different minimum rate of wage than similar class of help on other public works construction in the same neighborhood”. (Mem of Dept of Labor, Bill Jacket, L 1934, ch 747.)

It is unclear why the terms "state, county, town and/or village” were retained and not expanded to parallel the provisions in Labor Law §220. However, given the manifest purpose of the amendment to extend the prevailing wage requirements to all public works, the retention of the prior terms does not evince a legislative intent to the contrary. Nor has defendant offered any policy reason why section 220-d should not apply to contracts entered into by school districts.

Ill

The determinative question, then, is whether plaintiff is entitled to recover from the school district the amount of additional wages and supplements it was required to pay its employees. Because section 220-d does not explicitly provide for a private cause of action, recovery may be had under the statute only if a legislative intent to create such a right of action is "fairly implied” in the statutory provisions and their legislative history (Sheehy v Big Flats Community Day, 73 NY2d 629, 633; see also, CPC Intl. v McKesson Corp., 70 NY2d 268, 276; Burns Jackson Miller Summit & Spitzer v Lindner, 59 NY2d 314, 325). Plaintiff argues that it has a cause of action on the ground that section 220-d was specifically intended to benefit contractors bidding on public works projects and because denying recovery would effectively nullify section 220-d. But it is certainly questionable whether the statute’s notice requirement was intended to protect a contractor which, like plaintiff, submits a bid in contravention of the statutorily mandated prevailing wages. And even assuming that the statute was intended, in some part, to protect such a contractor and that that purpose would be advanced by recognizing a private right of action on the contractor’s behalf (cf., Sheehy v Big Flats Community Day, supra, at 633-634), plaintiffs claim must still fail.

Our decisions have established that the most critical inquiry in determining whether to recognize a private cause of action where one is not expressly provided is whether such action would be consistent with the over-all legislative scheme (see, Sheehy v Big Flats Community Day, supra, at 634-635; CPC Intl. v McKesson Corp., supra, at 276; Burns Jackson Miller Summit & Spitzer v Lindner, supra, at 325). Contrary to plaintiffs argument, we believe that a private cause of action would be incompatible with both the means chosen by the Legislature to enforce article 8 and with the basic purposes underlying the statute. Article 8 authorizes the Department of Labor to direct payment of prevailing wages or supplements found to be due (see, Labor Law § 220 [7], [9]), and provides civil and criminal penalties for willful violators of Department orders (see, Labor Law § 220 [7-a], [9]). Further, pursuant to Labor Law § 220-d, a person or corporation that willfully pays below the prevailing rate, after entering into a contract where the prevailing wages were advertised and included in the contract, is subject to criminal penalties and, in certain circumstances, forfeiture of payments under the contract. A private cause of action, which would have the effect of making the public entity financially responsible for the underpayment, is contrary to the unmistakable aim of the entire enforcement scheme to place all liability for violating the prevailing wage requirements upon the noncomplying contractor.

The overriding purpose of section 220-d, intimately tied to that of article 8 as a whole, is set forth in the legislative history. The notice requirements of that section were added to "facilitate the work of the Department [of Labor] in relation to such public works contracts and in addition to set a known and acceptable minimum rate of wage to be paid workers on such type of work, that will help to remove the source of strife and certain evils in connection with the carrying on of such contracts” (Dept of Labor, Mem in support, Bill Jacket, L 1934, ch 747 [emphasis added]). To permit the recovery sought by plaintiff would run counter to that basic legislative goal. It would reward a contractor which underpays its employees in violation of section 220 and would, in effect, permit such contractor to amend its bid after completion of the contract at no expense to itself, but to the public entity for which the work was done (see, Williamson Roofing & Sheet Metal Co. v Town of Parish, 139 AD2d 97, 105; see also, Associated Bldrs. & Contrs. v City of Rochester, 67 NY2d 854; Village of Medina v Dingledine, 211 NY 24).

Further, such shifting of the burden from the contractor to the public entity would directly contravene the basic objectives of the competitive bidding process "to assure the prudent and economical use of public moneys” and "to facilitate the acquisition of facilities and commodities of maximum quality at the lowest possible cost” (General Municipal Law § 100-a [emphasis added]). If public entities, such as the school district here, are required to make additional payment to "low bidders” who fail to take prevailing wages into account when calculating their offers, the intended economies of the competitive bidding process and the resulting protection of the public fisc could seriously be undermined (see, Associated Bldrs. & Contrs. v City of Rochester, supra, at 855-856).

In sum, we hold that the notice provisions in Labor Law § 220-d apply to school districts, but that plaintiff does not have an implied private cause of action against the district for a violation of section 220-d. Accordingly, the order of the Appellate Division should be affirmed.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone and Bellacosa concur.

Order affirmed, with costs.

      . Both parties agree that defendant school district is a municipal corporation (see, 1899 Opns Atty Gen 302, 1932 Opns Atty Gen 257).

      . Plaintiff relies on several lower court decisions for the proposition that the statutory framework reflects a legislative intent to protect contractors by giving them foreknowledge of labor costs when bidding on public projects (see, e.g., Brang Co. v State Univ. Constr. Fund, 47 AD2d 178, 179; Armco Drainage & Metal Prods. v State of New York, 1 Misc 2d 94, 100). But the overriding purpose of the prevailing wage requirements is to ensure that workers on public projects receive adequate pay (see, Bucci v Village of Port Chester, 22 NY2d 195, 201); and the related, particular purpose of the notice requirements is to eliminate unfair competitive bidding by nonunion employers who might otherwise submit offers that are artificially low, because based upon worker compensation below the prevailing rates (see, Matter of Action Elec. Contrs. Co. v Goldin, 64 NY2d 213, 222-223; Williamson Roofing & Sheet Metal Co. v Town of Parish, 139 AD2d 97, 104). Clearly, neither of these legislative goals — the general or the more particular — suggests an intent to benefit an employer, such as plaintiff, which obtains a public works contract by submitting a bid calculated on illegally low employee wages.


author: Per Curiam.

text:
    Calvin W. Kinney et al., Plaintiffs, v G. W. Lisk Company, Inc., et al., Defendants and Third-Party Plaintiffs-Respondents. Hudson Steel Fabricators & Erectors, Inc., Third-Party Defendant-Appellant.
    Argued April 25,1990;
    decided June 7, 1990

      POINTS OF COUNSEL

      Bohdan Wenglowskyj and Marcella Seaburg for third-party defendant-appellant.

      Glenn E. Pezzulo and Audrey P. Peartree for defendants and third-party plaintiffs-respondents.
   OPINION OF THE COURT

Per Curiam.

Cromwell Construction, Inc., a general contractor, hired Hudson Steel Fabricators & Erectors, Inc., to perform certain work on a building project on property owned by G. W. Lisk Co., Inc. After an employee of Hudson suffered injuries on the job and obtained a settlement against Cromwell and Lisk, a jury apportioned liability in negligence against Cromwell (12%) and Hudson (88%). The trial court granted summary judgment to Cromwell in its third-party action against Hudson on the ground that Hudson had failed to procure insurance coverage for Cromwell against personal injury claims as the two had agreed in their subcontract. On Hudson’s appeal, the Appellate Division affirmed, holding that the contractual provision requiring Hudson to maintain insurance for Cromwell did not violate General Obligations Law § 5-322.1. We agree.

Paragraph 6.4 of the subcontract between Cromwell and Hudson provides that the "Subcontractor [Hudson] shall maintain such insurance policies * * * as will protect both the Contractor [Cromwell] and the Subcontractor [Hudson] * * * from claims for damages because of bodily injury * * * which may arise both out of and during its performance under this Agreement or after completion thereof [emphasis added]”. We have previously upheld similar agreements against challenges that they violate other sections of the General Obligations Law which, like section 5-322.1, prohibit agreements intended to free certain promisees from liability for their own negligence (see, e.g., Board of Educ. v Valden Assocs., 46 NY2d 653, 657 [building owner’s agreement to obtain liability coverage for contractor and subcontractors not violative of General Obligations Law § 5-323]; Hogeland v Sibley, Lindsay & Curr Co., 42 NY2d 153, 160 [commercial tenant’s agreement to maintain liability insurance for landlord not violative of General Obligations Law § 5-321]). For reasons analogous to those that governed our decisions in those cases, we uphold the agreement at issue here.

General Obligations Law § 5-322.1 renders void and unenforceable any provision or agreement in connection with building construction "purporting to. indemnify or hold harmless the promisee against liability for damage arising out of bodily injuries to persons * * * contributed to, caused by or resulting from the negligence of the promisee, his agents or employees [emphasis added]”. By its terms, the statute addresses only agreements to indemnify or hold harmless. It makes no reference to agreements to purchase or maintain insurance such as that contained in the subcontract here, and there is no basis for construing the statute’s narrow and unambiguous prohibition to cover such agreements. An agreement to procure insurance is not an agreement to indemnify or hold harmless, and the distinction between the two is well recognized (see, Roblee v Corning Community Coll., 134 AD2d 803, lv denied 72 NY2d 803; Grant v United States, 271 F2d 651, 655-656 [2d Cir]). Whereas the essence of an indemnification agreement is to relieve the promisee of liability, an agreement to procure insurance specifically anticipates the promisee’s "continued responsibility” for its own negligence for which the promisor is obligated to furnish insurance (Hogeland v Sibley, Lindsay & Curr Co., supra, at 161; see also, Board of Educ. v Valden Assocs., supra, at 657; 4 Appleman, Insurance Law and Practice § 2261).

Moreover, this particular distinction is what renders indemnification, but not insurance-procurement, agreements violative of the public policies underlying General Obligations Law § 5-322.1. While an agreement purporting to hold an owner or a general contractor free from liability for its own negligence undermines the strong public policy of placing and keeping responsibility for maintaining a safe workplace on those parties (see, e.g., Labor Law §§ 200, 240), the same cannot be said for an agreement which simply obligates one of the parties to a construction contract to obtain a liability policy insuring the other (see, Board of Educ. v Valden Assocs., supra, at 657; Hogeland v Sibley, Lindsay & Curr Co., supra, at 161).

Indeed, the legislative history of section 5-322.1 unambiguously reveals that insurance-procurement agreements were intended to survive the statute’s proscriptions. The Legislature’s particular purpose in enacting the statute was to invalidate "so-called 'broad form hold-harmless’ clauses”, then prevalent in the construction industry, which "caus[ed] contractors and subcontractors to assume liability for the negligence of others” (Assembly sponsor’s supporting Mem, Assembly Bill A. 862-B, Bill Jacket, L 1975, ch 408 [emphasis added]). The Legislature anticipated that the statute would effect substantial savings in the cost of construction projects specifically because it had found that liability protection insurance, which contractors and subcontractors could still be required to procure, was considerably less expensive than hold-harmless coverage, which they would no longer need to purchase (id.; Senate sponsor’s supporting Mem, Senate Bill S. 946-B [A. 862-B]; see also, New York State Thruway Authority, letter in opposition, June 9, 1975; Metropolitan Transportation Authority, letter in opposition, June 20, 1975; cf., Brown v Two Exch. Plaza, 76 NY2d 172 [decided herewith]). Hence, the Legislature not only distinguished between hold-harmless and insurance-procurement agreements, but also fully expected that the latter would continue to be incorporated into construction contracts.

Finally, because Hudson breached its agreement to procure liability insurance covering Cromwell, it is liable for the resulting damages, including Cromwell’s liability to plaintiff (see, Roblee v Corning Community Coll., supra, at 805; 4 Appleman, Insurance Law and Practice § 2269; Robinson v Janay, 105 NJ Super 585, 253 A2d 816, 819).

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone, Hancock, Jr., and Bellacosa concur in Per Curiam opinion.

Order affirmed, with costs.

       To the extent that Patenaude v General Elec. Co. (147 AD2d 335) is to the contrary, it should not be followed.


text:
    Eaves Brooks Costume Company, Inc., Also Known as Eaves Costume Co., Inc., Appellant, v Y.B.H. Realty Corp. et al., Defendants, and M. Lionel Aprill et al., Doing Business as New York Automatic Sprinkler Service Co., et al., Respondents.
    Argued May 2,1990;
    decided June 12, 1990

      POINTS OF COUNSEL

      Kenneth D. Goldberg, Jack L. Cohen, Richard P. Marin and Steven H. Beldock for appellant.

      Steven Farmer for M. Lionel Aprill, respondent.

      Charles P. Duffy for Wells Fargo Alarm Services, respondent.
   OPINION OF THE COURT

Chief Judge Wachtler.

This is an action to recover for property damage sustained by a commercial tenant when a fire sprinkler system malfunctioned and flooded the leased premises. The question presented on this appeal is whether the tenant can recover against the two companies under contract with the building’s owners to inspect the sprinkler system and to maintain an alarm system.

We agree with the Appellate Division that the complaint should be dismissed as against those two defendants. We rest our decision, however, not on the distinction between misfeasance and nonfeasance relied upon by that court to determine whether a contractual duty could give rise to tort liability to a third party, but rather on a weighing of the policy considerations applicable generally to the question whether a tort duty should be so extended. Based upon these considerations, we conclude that the alleged negligence of those defendants in performing their contractual obligations did not breach any duty of care owed to plaintiff.

Plaintiff Eaves Brooks Costume Company is in the business of renting and selling costumes for the theatre industry. In 1981, Eaves Brooks leased the top four floors of a building located in Long Island City and owned by defendants Y.B.H. Realty Corp. and Photostam Companies, Inc. The building was equipped with a fire sprinkler system covering 96,000 square feet and including approximately 1,000 sprinkler heads.

At the relevant times, defendant New York Automatic Sprinkler Service Co. was under contract with the building’s owners to inspect the sprinkler system and to report all service needs to them. The contract called for 12 inspections per year, at a yearly cost of $120. The contract price was for inspection only and did not obligate New York Automatic to provide maintenance. The contract further provided that New York Automatic "shall be under no liability except as herein expressly set forth, and, in no event shall its aggregate liability for damages, whatever the cause and whether or not due to negligence, be greater than One Hundred ($100) Dollars, unless at the time of the execution hereof, the parties agree in writing upon a greater liability in consideration of an additional sum to be paid by Subscriber”. There is no dispute that New York Automatic had in fact conducted such inspections for several years.

Similarly, defendant Wells Fargo Alarm Services was under contract with the owners to install and maintain a central station fire alarm system in the building. Pursuant to this contract, Wells Fargo installed a "paddle switch” to detect water flow in the sprinkler system and to send a signal to Wells Fargo’s offices in the event that the sprinkler system was activated. The annual charge for this service was $660. The contract limited Wells Fargo’s liability as follows: "It is understood that Wells Fargo is not an insurer; that insurance shall be obtained by Subscriber, if any is desired; that the sums payable hereunder * * * are based upon the value of services offered and the scope of liability undertaken and such sums are not related to the value of property belonging to Subscriber or to others located on Subscriber’s premises * * *. It is agreed that if Wells Fargo should be found liable for any losses or damages attributable to a failure of systems or services in any respect, its liability shall be limited to a sum equal to ten percent of the annual charge hereunder, or $250.00, whichever is greater. The Subscriber may obtain a greater limitation of liability, if desired, by payment of an increased annual rate, which shall be negotiated between the Subscriber and Wells Fargo upon the request of the Subscriber in writing.”

According to plaintiff’s allegations, on or about Saturday, November 14, 1981, a sprinkler head on the fifth floor of the building malfunctioned and began discharging water at a rate of about 2,760 gallons per hour. The building was unoccupied over the weekend and the alarm system failed to operate. Thus, the flooding continued until it was discovered by plaintiff’s employees on Monday, November 16. By that time, the water had done extensive damage to plaintiff’s inventory of costumes stored in the building. According to the complaint, the damage exceeded $1 million.

An expert hired by plaintiff concluded that the probable cause of the sprinkler head malfunction was deterioration, due to age, of its fusible link, which can cause the sprinkler to activate at progressively lower temperatures. Nationally recognized standards recommend periodic sample testing of sprinklers that have been in service for 50 years and replacement of all sprinklers made before 1920. The sprinkler heads in this system were manufactured in 1915.

With respect to the alarm system, plaintiff’s expert reported that the paddle switch was improperly located and that the system apparently had not been tested as frequently as recommended.

Plaintiff commenced this damages action against New York Automatic, Wells Fargo and the building’s owners, alleging as relevant here that New York Automatic failed to detect and notify the building’s owners of the defects in the system and that Wells Fargo had improperly installed and maintained the alarm system, particularly the paddle switch. After issue was joined, New York Automatic and Wells Fargo moved for summary judgment dismissing the complaint. In addition, Wells Fargo moved in the alternative for partial summary judgment limiting its liability to $250, pursuant to the limitation on liability contained in its contract with the owners. Plaintiff cross-moved to strike Wells Fargo’s affirmative defense based on the contractual limitation of liability.

Supreme Court granted defendants’ motions to the extent of dismissing plaintiff’s complaint insofar as it pleaded causes of action for breach of contract, concluding that plaintiff was an unintended, incidental beneficiary of the contracts. Otherwise, however, the court denied defendants’ motions, holding that defendants could be liable in tort for the negligent performance of contractual duties if their conduct amounted to misfeasance, but not if their conduct was nonfeasance. The court concluded that there was an issue of fact in that regard. Finally, the court granted plaintiff’s motion to strike Wells Fargo’s affirmative defense, holding that the contractual limitation could not bind a nonparty to the contract with respect to damages arising from the breach of a tort duty.

New York Automatic and Wells Fargo appealed and the Appellate Division reversed, insofar as appealed from, and dismissed the complaint in its entirety as against those defendants. The court held that the defendants’ alleged failure to properly inspect the sprinkler and alarm systems constituted nonfeasance, not misfeasance, and was therefore not actionable. In addition, the court ruled that the improper placement of the water paddle was not a proximate cause of the alarm system’s failure. We affirm, but on different reasoning.

The parties and both lower courts, relying on Melodee Lane Lingerie Co. v American Dist. Tel. Co. (18 NY2d 57), have assumed that the dispositive question in this case is whether the defendants’ conduct should be labeled misfeasance or nonfeasance. In Melodee Lane, we held that a company under contract to provide a central station fire alarm system could be liable to a tenant, not a party to the contract, for its failure to report an alarm where its conduct constituted "affirmative defective maintenance rather than mere inaction in performing its maintenance agreement.” (Id., at 65.) Following Melodee Lane, a number of lower courts have held that sprinkler maintenance and alarm companies can be liable to noncontracting parties only for misfeasance in the performance of the contract and that the failure to detect flaws in a sprinkler system or the failure of the alarm system is nonfeasance (World Trade Knitting Mills v Lido Knitting Mills, 154 AD2d 99; Appliance Assocs. v Dyce-Lymen Sprinkler Co., 123 AD2d 512; Corporate Leasing v AFA Protective Sys., 101 AD2d 768).

This mode of analysis has been criticized on the ground that the line between misfeasance and nonfeasance is difficult to draw (see, Prosser and Keeton, Torts § 56, at 374 [5th ed]; 3 Harper, James & Gray, Torts § 18.6, at 729 [2d ed]). This is especially so in cases such as this involving contracts to inspect or maintain. An inspection that fails to uncover a defect could be labeled either misfeasance for negligent performance of the inspection or nonfeasance for failure to conduct some procedure that would have revealed the defect. There is no founded reason why liability should depend on such semantics.

In our view, the proper inquiry is simply whether the defendant has assumed a duty to exercise reasonable care to prevent foreseeable harm to the plaintiff. In the ordinary case, a contractual obligation, standing alone, will impose a duty only in favor of the promisee and intended third-party beneficiaries and mere inaction, without more, establishes only a cause of action for breach of contract (see, Prosser and Keeton, op. cit., § 92, at 659-660). But even inaction may give rise to tort liability where no duty to act would otherwise exist if, for example, performance of contractual obligations has induced detrimental reliance on continued performance and inaction would result not "merely in withholding a benefit, but positively or actively in working an injury” (Moch Co. v Rensselaer Water Co., 247 NY 160, 167). In such a case, the defendant has undertaken not just by his promises but by his deeds a legal duty to act with due care.

Ultimately, however, no matter how this inquiry is resolved, it remains for the courts to determine the fundamental question whether, as a matter of policy, the alleged negligence should result in liability. As we noted in Strauss v Belle Realty Co. (65 NY2d 399, 402-403), it is "the responsibility of courts, in fixing the orbit of duty, 'to limit the legal consequences of wrongs to a controllable degree’ * * * The courts’ definition of an orbit of duty based on public policy may at times result in the exclusion of some who might otherwise have recovered for losses or injuries if traditional tort principies had been applied.” (Quoting Tobin v Grossman, 24 NY2d 609, 619 [other citations omitted].)

We conclude that liability should not be imposed upon New York Automatic and Wells Fargo in these circumstances. Significantly, nothing in our decision precludes plaintiff from seeking damages from the building’s owners, and the owners and plaintiff are both in a position to insure against losses such as those sustained here. The plaintiff and the owners know or are in a position to know the value of the goods stored and can negotiate the cost of the lease and limitations on liability accordingly.

If, on the other hand, New York Automatic and Wells Fargo were answerable for property damage sustained by one not in contractual privity with them, they would be forced to insure against a risk the amount of which they may not know and cannot control, and as to which contractual limitations of liability may be ineffective. The result would be higher insurance premiums passed along through higher rates to all those who require sprinkler system and alarm services. In effect, the cost of protection for those whose potential loss is the greatest would be subsidized by those with the least to lose. In this setting, we see no reason to distribute the risk of loss in such a manner.

Furthermore, the prices paid for defendants’ services, according to specific language in the contracts, were calculated on the understanding that the risk of loss remained with the building’s owners. While plaintiff is not bound by the provisions of a contract to which it is not a party, the limited scope of defendants’ undertaking is nonetheless relevant in determining whether a tort duty to others should arise from their performance of the contractual obligations. Moreover, it suggests the need to contain liability within the limits envisioned in the contract in order to keep these services available at an affordable rate.

For these reasons we conclude that New York Automatic and Wells Fargo had no cognizable duty owing to plaintiff. Accordingly, the order of the Appellate Division should be affirmed, with costs.

Judges Simons, Kaye, Alexander, Titone, Hancock, Jr., and Bellacosa concur.

Order affirmed, with costs.

       These two defendants apparently defaulted and are not parties to this appeal. We will refer to them individually and collectively as the building’s owners.


author: Hancock, Jr., J. Alexander, J.

text:
    S.S.D.W. Co., Respondent, v Brisk Waterproofing Company, Inc., Appellant and Third-Party Plaintiff-Appellant; Coyne Electrical Contractors, Inc., Third-Party Defendant-Appellant.
    Argued May 2, 1990;
    decided June 12, 1990

      POINTS OF COUNSEL

      Lynne M. Fischman for appellant and third-party plaintiff-appellant.

      Irwin H. Haut for third-party defendant-appellant.

      Morton Greenwald and Roberta Burman for respondent.
   OPINION OF THE COURT

Hancock, Jr., J.

Plaintiff, the owner of an apartment building, contracted with defendant to do some corrective work. A fire broke out causing extensive damage not only to portions of the building covered by the contract but to other areas as well. Plaintiffs insurer paid plaintiff for the full extent of the damage, and in this negligence action, suing in the name of plaintiff as its subrogee, seeks reimbursement for its loss. The narrow issue in this appeal, requiring an interpretation of the subrogation waiver clause in the agreement between plaintiff owner and defendant contractor, is whether that clause bars the subrogation claim for damage to those portions of the building not included in the Work under the contract. For reasons stated hereafter, we agree with the Appellate Division that the waiver clause applies only to damage to the areas within the limits of "the Work” and that, therefore, the subrogation claim is, except for such damages, not barred. Accordingly, there should be an affirmance.

I

Plaintiff, the owner of Carnegie Towers in Manhattan, contracted with defendant, a waterproofing contractor, to do certain corrective work on the exterior of the building and the parking garage floor. The relevant provisions of the contract, a standard American Institute of Architects (AIA) form contract for "construction projects of limited scope”, are these.

Under article 1 (the Work), the specific work required to be performed is described as follows: "Corrective Work to the Masonry and Concrete Portions of Exterior Walls and the Parking Garage Floor Slab for Carnegie Towers 115 East 87th Street New York, New York”.

The general provision describing the Work, set forth in article 7.4, is as follows: "The Work comprises the completed construction required by the Contract Documents and includes all labor necessary to produce such construction, and all materials and equipment incorporated or to be incorporated in such construction.”

Under article 17 (Insurance) the following provisions are pertinent:

Article 17.1 requires that the contractor purchase and maintain: "liability insurance * * * to protect [it] * * * from claims for damages, other than to the Work itself, to property which may arise out of or result from the Contractor’s operations under this Contract” (emphasis supplied).

Article 17.3 requires that the owner: "purchase and maintain property insurance upon the entire Work at the site to the full insurable value thereof. This insurance shall include the interests of the Owner, the Contractor, Subcontractors and Sub-subcontractors in the Work and shall insure against the perils of fire” (emphasis supplied).

Article 17.6 provides: "[t]he Owner and Contractor waive all rights against each other for damages caused by fire or other perils to the extent covered by insurance obtained pursuant to this Article or any other property insurance applicable to the Work” (emphasis supplied).

On May 24, 1984, a fire started in a shed constructed by defendant on a fifth-floor terrace, causing approximately $140,000 in damages to the interior hallways, apartments and to the exterior of the building. Seven months after the fire, plaintiff was paid $139,351.74 for the loss by its property insurer which has brought this action as subrogee to recover its loss from defendant. Defendant, in turn, has commenced a third-party action against its subcontractor, Coyne Electrical Contractors.

Relying on the waiver provision contained in article 17.6, defendant moved to dismiss the complaint. Supreme Court granted defendant’s motion and, sua sponte, dismissed the third-party action, citing Trump-Equitable Fifth Ave. Co. v H.R.H. Constr. Corp. (106 AD2d 242, affd for reasons stated below 66 NY2d 779). The Appellate Division, with one Justice dissenting, modified on the law by reinstating the complaint to the extent that it seeks damages for losses to portions of the building not included in the contractual work and reinstated the third-party complaint. The Appellate Division distinguished Trump-Equitable and held that, under the contract here, plaintiff was required to obtain coverage only for "the Work” and that "[a]ny other coverage the owner may have had for the property was not, by the terms of [article] 17.6, subject to the waiver of subrogation therein” (153 AD2d, at 478). The Appellate Division certified to this court the question: "Was the order of the Supreme Court, as modified by this Court, properly made?” We answer the question in the affirmative.

II

Our decision turns on a construction of article 17.6 in the contract in which the owner agreed to waive all rights against the contractor for damages caused by fire "to the extent covered by insurance obtained pursuant to this Article or any other property insurance applicable to the Work”. The question is: Does the owner’s waiver under article 17.6 bar the subrogation claim of its insurer for damages caused by the contractor in areas of the building outside the limits of the Work?

In addressing the legal issue of what the parties intended, we note that we are dealing with a commercial construction contract between business entities. The owner and contractor in article 17.6 (the waiver clause), article 17.1 (requiring the contractor to insure its potential liability for non-Work property damage) and article 17.3 (requiring the owner to provide property insurance for the contractor’s Work) have agreed upon an allocation of their respective responsibilities, risks and insurance obligations pertaining to the possibility of property damage occurring during the contract and to the contractor’s potential liability stemming from its operations. Neither party claims that the contract is ambiguous nor raises any claim of misunderstanding, overreaching or unconscionability. No policy consideration or other reason has been suggested why the parties should not abide by their agreed-upon allocation of the risks and responsibilities, once the meaning of their agreement has been determined (see, Gillman v Chase Manhattan Bank, 73 NY2d 1, 14; Kalisch-Jarcho, Inc. v City of New York, 72 NY2d 727, 732; Simons v Fried, 302 NY 323, 324).

The allocation of the risks and responsibilities, according to plaintiff, is that the owner must provide property insurance protection covering the contractor’s Work (art 17.3) and the contractor, in turn, must provide liability insurance covering whatever property damage it may cause other than to the Work itself (art 17.1). The waiver clause (art 17.6), plaintiff says, permits the owner’s insurer to proceed against the contractor for property damage caused by its negligence but not for damage covered by insurance which the owner has provided to protect the contractor’s interest — i.e., damage resulting to the contractor’s Work. As to such damage, there can be no subrogation. In the event of a loss, such as the one here, involving fire damage to the Work and areas beyond the Work, the damages may be shared between the owner’s insurer (which is responsible for so much of the damage as occurs to the Work) and the contractor’s liability insurer (which, assuming there is liability, must bear ultimate responsibility for damages outside the Work).

The agreement, as the defendant and third-party defendant view it, allocates a greater share of the risk and responsibilities to the owner and ultimately to the owner’s insurer. Under their construction, the waiver clause (art 17.6) prevents the owner’s insurer from proceeding against the contractor for its negligence not only for damage occurring to the Work but to other areas of the building, provided that the damage "arose out of, or was related to, the Work itself.” (Brief of third-party defendant, at 13.) Thus, in the event of a fire arising out of the contractor’s operations which results in damage both to the Work and areas outside the Work, the owner’s insurance carrier’s right to subrogate is totally barred. In addition to the loss for damage to the Work, the owner’s carrier must also bear the loss for damage to other areas which, under the contrary construction urged by plaintiff, would ultimately have been borne by the liability insurer of the contractor.

Our analysis of the contract supports plaintiff’s construction. The waiver clause (art 17.6) bars the claim of the owner’s subrogee to the extent that the damages sought are covered either by: (1) "insurance obtained pursuant to [art 17]” or (2) "any other property insurance applicable to the Work” (emphasis added). The first alternative (insurance obtained pursuant to art 17) refers to insurance which the owner has procured under article 17.3 in which it is obligated to provide insurance "upon the entire Work at the site” (emphasis added) and to include therein the interests of the contractor and subcontractors "in the Work” (emphasis added). The second speaks for itself. It refers only to other insurance "applicable to the Work” (emphasis added). It makes no difference whether the policy under which subrogation is sought is one which the owner purchased specifically to insure the Work pursuant to article 17.3 or some other policy covering the owner’s property in which the owner has also provided coverage for the Work. In either event, the waiver clause, if given its plain meaning, bars subrogation only for those damages covered by insurance which the owner has provided to meet the requirement of protecting the contractor’s limited interest in the building — i.e., damages to the Work itself. On the other hand, no wording in article 17 supports the view urged by defendants, that the waiver in article 17.6 includes not only damage to the Work itself but encompasses all damages flowing from the Work.

Plaintiff owner’s construction of article 17.6, unlike that of defendants, gives full effect to the bargain concerning the parties’ respective insurance responsibilities set forth in article 17. Under article 17.1, the contractor is required to obtain liability insurance protecting it from "claims for damages * * * to property * * * other than to the Work itself’. Under plaintiff’s construction, in the event of a claim for non-Work property damage, the insurer under the contractor’s liability policy would be responsible. Under the construction of article 17.6 urged by defendants, however, this would not be so. The contractor’s liability insurer is relieved of responsibility for any damage caused by the contractor to parts of the building outside the Work. Any responsibility for such a loss which the contractor’s insurer might otherwise bear is transferred to the owner’s insurer which in effect, is transformed into the liability carrier for the contractor. This result is not consistent with either the natural and obvious meaning of article 17.6 or with what seems to be the over-all sense of the arrangement in article 17 — that the contractor is to be responsible for negligently caused damage outside the Work and must carry a policy insuring its liability therefor (see, art 10.7 in which the contractor assumes responsibility to the owner for acts and omissions of its employees and its subcontractors).

Moreover, plaintiff’s interpretation of the subrogation waiver clause as being limited in scope to damage to the Work is consistent with the difference which our case law recognizes in the respective interests of the owner and contractor under an owner’s property insurance policy during the course of construction. Under Tishman Co. v Carney & Del Guidice (34 NY2d 941, 942-943, affg 36 AD2d 273), the contractor’s insurable interest in the irlsured building extends only to the tools, labor and materials which it has furnished and the owner’s insured’s right of subrogation is barred only to the extent of that insurable interest. The rationale of Tishman is simply that the contractor is a constructive insured under the owner’s property insurance policy only to the extent of its insurable interest in the building; it follows, therefore — under the settled rule that the insurer has no right of subrogation against its own insured (see, Pennsylvania Gen. Ins. Co. v Austin Powder Co., 68 NY2d 465, 471; cf., New York Bd. of Fire Underwriters v Trans Urban Constr. Co., 60 NY2d 912)— that the owner’s insurer is barred from subrogation only to the extent of property in which the contractor has an insurable interest: i.e., its tools and the labor and materials which it has furnished (see, arts 1, 17.4).

Defendant’s broad construction of article 17.6 — embracing all claims for damages to the building covered by the owner’s property insurance, not only property in which the contractor has an insurable interest — is patently inconsistent with Tishman and imposes a restriction on the carrier’s subrogation rights beyond that imposed by the law or by what seems to be the commonsense reading of article 17. We are, thus, not persuaded by the reasoning in Haemonetic Corp. v Brophy & Phillips Co. (23 Mass App 254, 501 NE2d 524 [1986]), relied on by defendants, that merely because "the owner chose to provide [broader insurance than necessary] to comply” with the requirement in the insurance clause, the owner’s insurer’s subrogation rights should be barred for all damage to the building irrespective of the contractor’s insurable interest (id., at 526).

We agree with the analysis of the court in Public Employees Mut. Ins. Co. v Sellen Constr. Co. (48 Wash App 792, 740 P2d 913 [1987]), a case similar to the one at bar involving identical contractual provisions, in which the court reached a result consistent with Tishman. There, in interpreting the waiver clause as not barring the carrier’s subrogation claim for non-Work damage, the court concluded that the parties intended that the contractor be required to maintain liability insurance "covering any damage to non-Work property caused by its construction activities. Likewise, the parties must have intended that [the contractor] not be included as a co-insure[d] on [the owner’s] insurance with respect to any loss that occurred to such non-Work property. [The owner], on the other hand, was to have purchased insurance to cover the Work, and [the contractor] was constructively co-insured [as to this]” (id., at 796, at 915 [emphasis added]).

Defendants contend, and the dissenters agree, that this court’s decision in Trump-Equitable Fifth Ave. Co. v H.R.H. Constr. Corp. (106 AD2d 242, affd 66 NY2d 779, supra) supports their construction of the contract and is controlling here. We disagree. As the Appellate Division held, Trump-Equitable is distinguishable. Under the contract at issue in Trump-Equitable, the work to be performed involved the construction of the entire building; the owner was required to procure property insurance for the entire building; therefore,. the owner’s waiver under the subrogation waiver clause extended to damage to the entire building. The contract at issue here, by contrast, is a "limited scope” construction contract; the Work includes only the exterior walls and the floor of the parking garage; the owner’s responsibility to procure insurance and the corresponding waiver of subrogation rights extend only to those specific areas. For the same reason, other cases relied on by defendants and cited by the dissent, involving contracts for the construction of entire buildings, are also inapposite (see, e.g., Tokio Mar. & Fire Ins. Co. v Employers Ins., 786 F2d 101 [2d Cir 1986] [citing Trump-Equitable]; South Tippecanoe School Bldg. Corp. v Shambaugh & Son, 182 Ind App 350, 395 NE2d 320; Morsches Lbr. v Probst, 180 Ind App 202, 388 NE2d 284 [3d Dist 1979]). As the Washington court in Public Employees Mut. Ins. Co. v Sellen Constr. Co. (48 Wash App, at 796, 740 P2d, at 915, supra) observed, "The court cannot ignore the language agreed upon by the parties, or revise or rewrite the contract”.

As plaintiff now concedes, the lower courts properly dismissed its claim to the extent it sought recovery for damages to the Work itself. To the extent plaintiffs insurer, the real party in interest, seeks recovery for damages to property other than the Work, this claim is not barred by plaintiffs waiver in article 17.6.

Accordingly, the order of the Appellate Division should be affirmed and the certified question answered in the affirmative.

Alexander, J.

(dissenting). The majority holds today that the subrogation waiver clause in this standard American Institute of Architects (ALA) form contract does not bar the owner’s insurer from seeking recovery from the contractor for property damage to the owner’s building so long as the damage is not to the actual work to be performed under the contract. This limited construction of the subrogation waiver clause is flatly contrary to our construction of an identical clause in Trump-Equitable Fifth Ave. Co. v H.R.H. Constr. Corp. (106 AD2d 242, affd for reasons stated below 66 NY2d 779) and undermines the very purpose of the clause. Rather than promoting certainty as to the liability of the parties to these standard contracts, the majority’s construction of this standard waiver clause invites litigation as to whether the damages in any particular case fall within the scope of the work to be performed under the contract. In my view, a construction of the clause to bar the owner from seeking all damages as to which it has obtained insurance under the contract, thereby barring any subrogation action by the owner’s insurer, best effectuates the intent of the parties to the contract. Accordingly, I respectfully dissent.

The contract allocates the risks of the construction by requiring that the contractor obtain third-party liability insurance and the owner obtain first-party coverage for property damage to "the entire Work at the site to the full insurable value thereof’ and further providing that the parties waive all rights against each other for damages covered by such insurance. The relevant provisions of article 17, which relates to insurance, are as follows.

"17.1 Contractor’s liability insurance shall be purchased and maintained by the Contractor to protect him from claims under the worker’s or workmen’s compensation acts and other employee benefit acts, claims for damages because of bodily injury, including death, and from claims for damages, other than to the Work itself, to property which may arise out of or result from the Contractor’s operations under this Contract * * *

"17.3 Unless otherwise provided, the Owner shall purchase and maintain property insurance upon the entire Work at the site to the full insurable value thereof. This insurance shall include the interests of the Owner, the Contractor, Subcontractors and Sub-subcontractors in the Work and shall insure against the perils of fire and extended coverage and shall include 1all-risk’ insurance for physical loss or damage including, without duplication of coverage, theft, vandalism, and malicious mischief. * * *

"17.6 The Owner and Contractor waive all rights against each other for damages caused by fire or other perils to the extent covered by insurance obtained pursuant to this Article or any other property insurance applicable to the Work, except such rights as they may have to the proceeds of such insurance held by the Owner as trustee.” (Emphasis added.)

The owner’s property insurance must provide "all-risk” coverage and "includes”, but is not limited to, the respective parties’ interests in the "Work”.

In Trump-Equitable Fifth Ave. Co. v H.R.H. Constr. Corp. (106 AD2d 242, affd for reasons stated below 66 NY2d 779, supra), the Appellate Division concluded that this subrogation waiver clause bars any action by an owner (or an owner’s subrogee) against a contractor for property damage to the subject building falling within the owner’s first-party coverage. Reasoning that a contract provision requiring the contractor to indemnify the owner related only to liability to third parties and thus did not come within the owner’s first-party coverage, the court held that the indemnity and waiver provisions were not in conflict (id., at 244-245; see also, Federal Ins. Co. v Zwicker Elec. Co., 144 AD2d 632; Tokio Mar. & Fire Ins. Co. v Employers Ins., 786 F2d 101 [2d Cir 1986]). Our affirmance of this reasoning was in no way dependent upon the fact, seized upon by the majority (majority opn, at 236), that the contract in Trump-Equitable related to the construction of an entire building rather than, as in this case, construction work performed on an existing building.

Nor would such a distinction be meaningful in light of the fact that these subrogation waiver clauses are intended to avoid litigation over claims for damages while also protecting the parties by "in effect simply requiring] one of the parties to the contract to provide insurance for all of the parties” (Board of Educ. v Valden Assocs., 46 NY2d 653, 657; Tokio Mar. & Fire Ins. Co. v Employers Ins., 786 F2d, at 104, supra; Haemonetics Corp. v Brophy & Phillips Co., 23 Mass App 254, 501 NE2d 524, 526). Here, it is the owner who was required to insure against damage to the building and to waive all claims against the contractor for losses covered by that insurance. I agree with those courts holding that in these circumstances the parties have agreed that the owner’s recovery for these losses is limited to its insurance proceeds and neither the owner, nor its insurer (as subrogee) has any cause of action against the contractor (see, Village of Rosemont v Lentin Lbr. Co., 144 111 App 3d 651, 494 NE2d 592; E. C. Long, Inc. v Brennan’s of Atlanta, 148 Ga App 796, 252 SE2d 642; Housing Inv. Corp. v Carris, 389 So 2d 689 [Fla App 1980]; see also, Insurance Co. v Wells, 35 Ohio App 2d 173, 300 NE2d 460; Morsches Lbr. v Probst, 180 Ind App 202, 388 NE2d 284 [1979]; South Tippecanoe School Bldg. Corp. v Shambaugh & Son, 182 Ind App 350, 395 NE2d 320 [1979]). As stated in Housing Inv. Corp. v Carris (389 So 2d, at 690, supra): "The owner had, as all owners always have, the right to insure his own property for his own exclusive benefit without the consent or agreement of the contractor or anyone else. Therefore, the only reasonably conceivable purpose of a construction contract provision placing an obligation on the owner to carry insurance is to benefit the contractor by providing him protection and exculpation from risk of liability for the insured loss. Although the contractor was not named as an insured, nor does the contract require this to be done, the contract insurance provision is valuable to the contractor for the very purpose this case exemplifies and serves to limit the owner to insurance proceeds even though the loss was caused by the negligence of the contractor.” Given this allocation of risk agreed upon by the parties, the fact that that insurance coverage is not limited to the actual work performed under the contract is irrelevant (Haemonetics Corp. v Brophy & Phillips Co., supra).

In this case, the "Work” to be performed is described in the contract, in part, as "Corrective Work to the Masonry and Concrete Portions of Exterior Walls” and included renovation of brick panels, masonry walls and windows on each of the building’s 38 floors. The limited construction of the subrogation waiver clause adopted by the majority today requires further litigation, and perhaps a trial, to determine the extent to which the damages suffered by plaintiff was related to that Work. In my view, this construction leaves the contractor’s liability uncertain in every case and thus completely undermines the purpose of the subrogation waiver clause. Accordingly, I vote to reverse the order of the Appellate Division and reinstate the judgment of Supreme Court granting summary judgment.

Judges Simons, Kaye and Titone concur with Judge Hancock, Jr.; Judge Alexander dissents and votes to reverse in a separate opinion in which Judge Bellacosa concurs; Chief Judge Wachtler taking no part.

Order affirmed, with costs, and certified question answered in the affirmative.

      . For simplicity, where appropriate, defendant and third-party defendant will be referred to collectively as "defendants”.

      . Contrary to the contention of the dissent, the reasoning underlying the holding in Trump-Equitable Fifth Ave. Co. v H.R.H. Constr. Corp. (106 AD2d 242, affd 66 NY2d 779) is not that "a contract provision requiring the contractor to indemnify the owner related only to liability to third parties and thus did not come within the owner’s first-party coverage” (see, dissenting opn, at 238). The court simply construed the contract, which was for the construction of an entire building, as obligating the owner to purchase "property insurance for damages to the construction project to its full insurable value” (106 AD2d, at 243, supra) and "to obtain first-party coverage for property loss in the event of damage to the building during [its] construction” (id., at 244-245). Nothing in Trump-Equitable supports the conclusion urged by the dissent that, under the general AIA conditions at issue, the contractor is only responsible for third-party claims. Indeed, such a conclusion is contrary to defendant’s general responsibility to plaintiff for the acts and omissions of its employees under article 10.7 and its specific responsibility under article 17.1 to procure liability insurance for claims for property damage, other than to the Work itself.

      . Still other cases cited are inapposite because the contract clauses requiring the owner to procure insurance were broader than the clause here (see, Housing Inv. Corp. v Carris, 389 So 2d 689 [Fla App 1980]; Insurance Co. v Wells, 35 Ohio App 2d 173, 300 NE2d 460 [1973]).

      . The majority’s reliance upon Tishman Co. v Carney & Del Guidiee (34 NY2d 941, affg 36 AD2d 273) in support of its contrary construction of the subrogation waiver provision is misplaced (majority opn, at 234-235). Tishman involved whether, absent an insurable interest in the damaged property, a contractor was a coinsured under the owner’s insurance policy so as to bar, by operation of law, a subrogation action against the contractor. In this case, by contrast, plaintiff has agreed, as it was free to do, to limit its recovery to its insurance proceeds and thereby preclude an action by its subrogee. It is of no consequence, therefore, that absent such an agreement, plaintiff’s subrogee would be limited to an action against defendant for damage to property other than the Work (Tishman Co. v Carney & Del Guidice, supra).

        . Public Employees Mut. Ins. Co. v Sellen Constr. Co. (48 Wash App 792, 740 P2d 913 [1987]), cited as contrary authority by the majority (majority opn, at 235), is not persuasive. That case involved damage to microfiche records which were not located at the construction site. While the court concluded that a subrogation action against the contractor was not barred by the subrogation waiver clause because these records did not constitute the "Work” for which the owner was required to obtain insurance, the decision turned upon the fact that the records were not located at the construction site (id., at 914-915). In fact, the court expressly distinguished Trump-Equitable Fifth Ave. Co. v H.R.H. Constr. Corp. (106 AD2d 242, affd 66 NY2d 779) and Village of Rosemont v Lentin Lbr. Co. (144 111 App 3d 651, 494 NE2d 592) by explaining that in those cases "there was sufficient evidence * * * that the damage was to the Work, i.e., property under construction or property unambiguously located at the construction site” (id.).