author: Per Curiam.

text:
    In the Matter of Norman F. Russakoff, an Attorney, Appellant. Grievance Committee for the Second and Eleventh Judicial Districts, Respondent.
    Argued April 1, 1992;
    decided May 5, 1992

      POINTS OF COUNSEL

      Nicholas C. Cooper for appellant. I.
    Section 691.4 (l) (1) of the Appellate Division, Second Department (22 NYCRR), permits the immediate suspension of an attorney only upon a finding of guilt of misconduct "immediately threatening the public interest” based upon either "a substantial admission under oath * * * or * * * other uncontroverted evidence”. (Matter of Padilla, 67 NY2d 440; Matter of Nuey, 61 NY2d 513.) II. Petitioner’s alleged evidence of conversion of clients’ funds was clearly controverted by respondent’s denial that he is guilty thereof and by petitioner’s failure to prove a necessary element of conversion, namely venal intent. (Matter of Altomerianos, 160 AD2d 96; Matter of Goodman, 146 AD2d 78.) III. The Appellate Division, Second Department’s "immediate” suspension rule (22 NYCRR 691.4 [l]), is unconstitutional since it fails to provide for a sufficiently prompt hearing after imposition of an interim suspension. (Barry v Barchi, 443 US 55.) IV. Since the standard of proof applied by the Appellate Division, Second Department, is far less stringent than the "venal” intent standard applied by the Appellate Division, First Department, in "conversion” cases, respondent is denied his constitutional guarantee of equal protection of the law. V. Imposition by the Appellate Division of a suspension rendered effective "immediately” and without prior notice to respondent violates due process of law. VI. Respondent may not be disciplined for invoking his privilege against self-incrimination. (Spevack v Klein, 385 US 511.)

      Robert H. Straus for respondent. I.
    The Appellate Division, Second Department, properly exercised its authority, pursuant to 22 NYCRR 691.4 (l), in suspending appellant from the practice of law, pending the outcome of a disciplinary proceeding. (Matter of Padilla, 67 NY2d 440; Matter of Iversen, 51 AD2d 422; Matter of Detsky, 16 AD2d 595; Matter of Rogers, 94 AD2d 121; Matter of Pinello, 100 AD2d 64; Matter of Frankel, 123 AD2d 468; Matter of Harris, 124 AD2d 126; Matter of Kirwin, 127 AD2d 264; Matter of Swyer, 143 AD2d 462; Matter of Rondel, 158 NY 216.) II. Having failed to assert constitutional challenges in the court below, appellant may not raise them for the first time on this appeal. (Di Bella v Di Bella, 47 NY2d 828; Cibro Petroleum Prods. v Chu, 67 NY2d 806.) III. Appellant has not been deprived of his due process rights in that he has been afforded the opportunity for a prompt postsuspension hearing. (Arnett v Kennedy, 416 US 134; Barry v Barchi, 443 US 55; Gershenfeld v Justices of Supreme Ct. of Pa., 641 F Supp 1419; Cleveland Bd. of Educ. v Loudermill, 470 US 532.)

      Hal R. Lieberman and Barbara S. Gillers for the Departmental Disciplinary Committee for the First Judicial Department, amicus curiae.

    The temporary suspension rule does not violate due process. (In re Buffalo, 390 US 544; Matter of Mitchell, 40 NY2d 153; Morrissey v Brewer, 408 US 471; Mathews v Eldridge, 424 US 319; Federal Deposit Ins. Corp. v Mallen, 486 US 230; Mitchell v Grant Co., 416 US 600; Matter of Anonymous Attorneys, 41 NY2d 506; Matter of Rochlin, 100 AD2d 263; Matter of Glassman, 19 AD2d 146.)
   OPINION OF THE COURT

Per Curiam.

Respondent attorney was suspended from the practice of law pending final disposition of charges that he had mishandled clients’ funds. The issue in this appeal is whether the Appellate Division order of suspension complied with the requirements of Matter of Padilla (67 NY2d 440).

In the fall of 1989, in response to a client complaint, the Grievance Committee for the Second and Eleventh Judicial Districts initiated an inquiry into respondent’s handling of his client bank accounts. The inquiry, which included an inspection of certain bank records furnished by respondent, revealed a number of unexplained withdrawals from several escrow accounts containing client and estate funds. This discovery prompted the Committee to direct respondent to appear and to give testimony regarding his "apparent conversion” of clients’ funds.

After learning that the Committee intended to use any admissions he might make against him, respondent declined to appear in person and elected instead to submit an affirmation in which he "categorically denied” that he had engaged in conduct "involving 'fraud, deceit or misrepresentation.’ ” With regard to any specific questions about his handling of client funds, respondent affirmed that he had "no alternative but to exercise [his] constitutional right against self-incrimination.”

Following the submission of this affirmation, the Committee moved by order to show cause for authorization to commence formal disciplinary proceedings against respondent. The Committee also sought an order suspending respondent during the pendency of the proceedings on the grounds that there was "uncontroverted evidence of his professional misconduct” and that respondent was "guilty of professional misconduct immediately threatening the public interest.” Submitted in support of this request for relief were the bank statements the Committee had inspected, as well as other documentary evidence demonstrating respondent’s unexplained use of client funds. Also submitted was a copy of the Committee’s proposed petition, which alleged that respondent had violated Code of Professional Responsibility DR 9-102 and DR 1-102 (A) (1), (4) and (7). Once again, respondent’s only reply was that he had not engaged in "any intentional or wilful misconduct.”

By order dated October 31, 1991, the Appellate Division granted the Committee’s motion and ordered respondent temporarily suspended immediately. The court also authorized the initiation of formal disciplinary proceedings, referring the matter to a Special Referee and directing service of the Committee’s petition within 90 days. The order, however, did not include any other provisions regarding the timing of either the hearing or the final disposition of the charges against respondent. Significantly, the court did not set forth the reasons for its decision to suspend respondent. On respondent’s subsequent application, this Court granted him leave to appeal to the Court of Appeals. We now conclude that the Appellate Division order of temporary suspension cannot stand.

In Matter of Padilla (supra, at 448-449), we held that in certain narrow circumstances the Appellate Division has the power to suspend attorneys charged with misconduct even though the disciplinary proceedings against them remain pending. Specifically, we held that interim suspensions are permissible where the misconduct in question poses an immediate threat to the public interest and is clearly established either by the attorney’s own admissions or by other uncontroverted evidence (id.). We further stated in Padilla that when the Appellate Division decides to issue an interim suspension order, it should articulate the reasons for its decision. While the failure to articulate the basis of an interim suspension decision may not be fatal in all cases, it is a defect that cannot be overlooked where the papers on which the decision was based leave room for doubt or ambiguity (see, id.).

Here, respondent had made no admissions. In fact, he affirmatively denied any "intentional or wilful” misconduct. While that denial may not have been sufficient to controvert charges that he had violated DR 9-102, which concerns attorneys’ fiduciary and record-keeping responsibilities (see, Matter of Harris, 124 AD2d 126; Matter of Iversen, 51 AD2d 422), it did give rise to a question as to whether respondent violated DR 1-102 (A) (4), which was cited by the Committee and has been held to require a showing of intent to defraud, deceive or misrepresent (Matter of Altomerianos, 160 AD2d 96). Accordingly, it cannot be said that the Committee’s charges of misconduct were completely "uncontroverted.”

Further, because the Appellate Division did not state the reason for its interim suspension order, there is no way of knowing whether its decision was predicated on the uncontroverted allegations that DR 9-102 had been violated or was instead premised on the claimed violation of DR 1-102 (A) (4), as to which there was considerable dispute. Thus, we cannot now determine whether the suspension order was issued in compliance with Matter of Padilla (supra).

Because it is impossible to determine whether the Appellate Division acted within the guidelines set forth in Padilla, we conclude that the court’s temporary suspension order must be reversed and the matter remitted to that court for further proceedings consistent with this opinion. In view of this disposition, we do not reach respondent’s alternative argument that the Appellate Division’s interim suspension order was improper because no provision was made for a reasonably prompt postsuspension hearing. However, inasmuch as the matter is to be remitted, it is worthwhile to note that neither the Appellate Division rules governing interim suspensions (22 NYCRR 603.4 [e]; 691.4 [l]; 806.4 [f\; 1022.19 [f]) nor the specific order issued in this case provide for a prompt postsuspension hearing. Some action to correct this omission seems warranted (see, Barry v Barchi, 443 US 55, 66-68; Gershenfeld v Justices of Supreme Ct., 641 F Supp 1419).

Accordingly, the order of the Appellate Division should be modified, without costs, by vacating so much of the order as suspended respondent from the practice of law pending the outcome of disciplinary proceedings, and the matter remitted to the Appellate Division, Second Department, for further proceedings in accordance with the opinion herein.

Chief Judge Wachtler and Judges Kaye, Titone, Hancock, Jr., Bellacosa and Yesawich, Jr., concur in Per Curiam opinion; Judge Simons taking no part.

Order modified, without costs, and matter remitted to the Appellate Division, Second Department, for further proceedings in accordance with the opinion herein.

       Designated pursuant to NY Constitution, article VI, § 2.


source: Caselaw Access Project

author: Chief Judge Wachtler.

license: Public Domain

text:
    In the Matter of Josef Meisels, Respondent, v Alexander Uhr, Also Known as Chaim Uhr, et al., Appellants, and Tzvi M. Ginsberg et al., Respondents. (Proceeding No. 1.) In the Matter of Alexander Uhr et al., Appellants, v Josef Meisels, Respondent. (Proceeding No. 2.)
    Argued March 31, 1992;
    decided May 12, 1992

      POINTS OF COUNSEL

      Richard A. Finkel, George S. Meissner, Ronald M. Klein-berg, Peter D. Close and Marc H. Gerstein for appellants. I.
    The agreements by the parties to arbitrate "all the disputes between them and as well on the three buildings” are valid arbitration agreements under CPLR 7501. (Matter of Bohlinger [National Cash Register Co.], 305 NY 539; Matter of Weinrott [Carp] 32 NY2d 190; Matter of Sprinzen [Nomberg], 46 NY2d 623; Matter of 166 Mamaroneck Ave. Corp. v 151 E. Post Rd. Corp., 78 NY2d 88; Matter of Baime [Martin’s] 88 AD2d 595; Bowmer v Bowmer, 50 NY2d 288.) II. The rulings of the courts below, that the arbitration agreements were invalid under Judaic law are incorrect and constitute an infringement on freedom of religion and hence, are unconstitutional under the First Amendment to the US Constitution. (Presbyterian Church v Hull Church, 393 US 440; Matter of Silverman [Benmor Coats] 61 NY2d 299; Watson v Jones, 13 Wall [80 US] 679; Knight v Presbytery of W. N. Y., 26 AD2d 19, 18 NY2d 868; Serbian Orthodox Diocese v Milivojevich, 426 US 696; Gonzalez v Archbishop, 280 US 1; Natal v Christian & Missionary Alliance, 878 F2d 1575; First Presbyt. Church v United Presbyt. Church, 430 F Supp 450; Thomas v Review Bd., Ind. Employment Sec. Div., 450 US 707; Berman v Shantes Lab., 43 AD2d 736.) III. Respondent’s willing participation in the arbitration proceedings precludes any review as to the validity of the agreements to arbitrate. (Matter of National Cash Register Co. [Wilson] 8 NY2d 377; Rochester City School Dist. v Rochester Teachers Assn., 41 NY2d 578; Matter of United Liverpool Faculty Assn. v Board of Educ., 52 NY2d 1038; Matter of Silverman [Benmor Coats] 61 NY2d 299; Matter of Darman [Lustgarten] 105 AD2d 1028; Aigen v Giannone, 49 AD2d 562; United Buying Serv. Intl. Corp. v United Buying Serv., 38 AD2d 75.) IV. The award rendered by the Beth Din was consistent with the authority granted to it by the arbitration agreements and should therefore be confirmed. (Matter of Long Is. Lbr. Co. [Martin] 15 NY2d 380; Sisters of St. John

      the Baptist v Geraghty Constructor, 67 NY2d 997; Matter of Nationwide Gen. Ins. Co. v Investors Ins. Co., 37 NY2d 91; Matter of Wilaka Constr. Co. [New York City Hous. Auth.], 17 NY2d 195; Matter of Mikel v Scharf, 105 Misc 2d 548, 85 AD2d 604; Shuffman v Rudd Plastic Fabrics Corp., 64 AD2d 699; Matter of Tilbury Fabrics v Stillwater, Inc., 81 AD2d 532, 56 NY2d 624; Matter of Raisler Corp. [New York City Hous. Auth.] 32 NY2d 274; Matter of Port Washington Union Free School Dist. v Port Washington Teachers Assn., 45 NY2d 411; Matter of Lentine [Fundaro] 29 NY2d 382.) V. Neither the forfeiture provision nor the provision waiving the right to appeal render the Beth Din arbitration agreements void as against public policy. (Matter of Associated Gen. Contrs. [Savin Bros.] 45 AD2d 136, 36 NY2d 957; Bogatz v Case Catering Corp., 86 Misc 2d 1052; Educational Beneficial v Reynolds, 67 Misc 2d 1052; Rymer v Leider, 122 Misc 2d 873; Sirlin Plumbing Co. v Babylon Country Club, 10 AD2d 995; People v Cox, 71 AD2d 798; Matter of Neirs-Folkes, Inc. [Drake Ins. Co.] 75 AD2d 787.) VI. The June 23, 1988 award of the Beth Din was a final award. (Volpe v Incognito, 23 Misc 2d 236; Howland v Howland, 15 AD2d 122; Najean Bldrs. v Harbor Bay Realty Co., 15 AD2d 580; Morgan Guar. Trust Co. v Solow, 114 AD2d 818, 68 NY2d 779; Matter of Mole [Queen Ins. Co.] 14 AD2d 1; Matter of Eisenstein [Rednick] 8 AD2d 794; Lentine v Fundaro, 29 NY2d 382; Dahlke v X-L-O Automotive Accessories, 40 AD2d 666; Matter of Wolff & Munier [Diesel Constr. Co.] 41 AD2d 618; People v McGrane, 17 Misc 2d 1004.) VII. Assuming this Court finds the Beth Din award partially invalid, it should still confirm all other portions of the award. (Matter of Wolff & Munier [Diesel Constr. Co.] 41 AD2d 618; Matter of Weiss [Metalsalts Corp.] 15 AD2d 46; Matter of Kozlowski v Seville Syndicate, 64 Misc 2d 109.)

      Stuart M. Fischman, Bernard Bronner, Jill F. Hunter and Laurence S. Margolin for Josef Meisels, respondent. I.
    The agreement to arbitrate was violative of the CPLR and case law and was entirely invalid. (Matter of Silverman [Benmor Coats] 61 NY2d 299; Matter of County of Rockland [Primiano Constr. Co.] 51 NY2d 1; Schubtex, Inc. v Allen Snyder, Inc., 49 NY2d 1; Matter of Marlene Indus. Corp. [Carnac Textiles] 45 NY2d 327; Matter of Riverdale Fabrics Corp. [Tillinghast-Stiles Co.] 306 NY 288, 307 NY 689; Matter of Doughboy Indus. [Pantasote Co.] 17 AD2d 216; Sisters of St. John the Baptist v Geraghty Constructor, 67 NY2d 997; Shuffman v

      Rudd Plastic Fabrics Corp., 64 A.D2d 699; Matter of Hellman [Wolbrom] 31 AD2d 477; Matter of Colwell Worsted Mills [Glass], 228 App Div 150.) II. The awards and modifications themselves were not properly made, issued and delivered to the parties. (Matter of Wolff & Munier [Diesel Constr. Co.] 41 AD2d 618.) III. An arbitrator may give evidence relating to the improprieties of the underlying arbitration proceedings. (Matter of Weiner Co. [Freund Co.] 2 AD2d 341, 3 NY2d 806; Matter of Big-W Constr. Corp. [Horowitz], 24 Misc 2d 145, 14 AD2d 817; Rembrandt Indus. v Hodges Intl., 38 NY2d 502; Lorillard v Clyde, 122 NY 41; Dodds v Hakes, 114 NY 260.) IV. The statements of one of the arbitrators undermines any statements to the contrary by appellants herein. V. The arbitration agreement and the proceedings were violative of public policy. (Glen Mfg. v Perfect Fit Indus., 299 F Supp 278, 420 F2d 319, 397 US 1042; Stahl v Stahl, 16 AD2d 467; J. M. Deutsch, Inc. v Robert Paper Co., 13 AD2d 768; Muller Constr. Co. v New York Tel. Co., 40 NY2d 955; Williams v Macchio, 69 Misc 2d 94; Roosevelt Hosp. v Orlansky, 92 Misc 2d 525; Matter of Goldfinger v Lisker, 68 NY2d 225; Matter of Wolff & Munier [Diesel Constr. Co.] 41 AD2d 618.) VI. The courts in the State of New York have the power to vacate arbitration awards which are made in contravention of public policy. (Matter of Neirs-Folkes, Inc. [Drake Ins. Co.] 75 AD2d 787, 53 NY2d 1038; Weinstein & Sons v City of New York, 264 App Div 398, 289 NY 741.) VII. The cases cited by appellants are wholly inapplicable to the instant action. (Kingsbridge Center v Turk, 98 AD2d 664; Matter of Kozlowski v Seville Syndicate, 64 Misc 2d 109; Matter of Bohlinger [National Cash Register Co.] 305 NY 539; Matter of Silverman [Benmor Coats] 61 NY2d 299; Matter of Newmeyer [Bill Chan’s Inc.] 23 AD2d 836; Rochester City School Dist. v Rochester Teachers Assn., 41 NY2d 578; Lentine v Fundaro, 29 NY2d 382; Matter of Weiss [Metalsalts Corp.] 15 AD2d 46, 11 NY2d 1042.) VIII. There was absolutely no infringement of the constitutional rights of appellants and this issue was not properly preserved for this appeal. (Matter of Shannon B., 70 NY2d 458; Thomas v Review Bd., Ind. Employment Sec. Div., 450 US 707; Watson v Jones, 13 Wall [80 US] 679; Avitzur v Avitzur, 58 NY2d 108, 464 US 817; Matter of Westchester Rockland Newspapers v Leggett, 48 NY2d 430.) IX. There are determinations as a matter of fact and of law in the courts below which demonstrate that the proceedings and awards were violative of the CPLR. (Farr v Newman, 14 NY2d 183.) X. The improper and irrational awards of the arbitration panel rendered the awards void. (Neiman v Springer, 71 AD2d 854.) XI. The arbitration panel was not empowered to alter their awards and to render improper substantive modifications, without notice and in the absence of a party. (Matter of Lewis v County of Suffolk, 77 AD2d 599.) XII. There is no partnership termination issue. (Phillips v Village of Oriskany, 57 AD2d 110; Mayer v McBrunigan Constr. Corp., 123 AD2d 606.) XIII. The awards and modifications of the arbitration panel were not final and definitive. (Morgan Guar. Trust Co. v Solow, 68 NY2d 779.)

      David Zwiebel, Morton Avigdor, Aaron Twerski and Martin Bienstock for Agudath Israel of America, amicus curiae. I.
    It weis reversible error for the courts below to nullify the Beth Din proceeding on the ground that the arbitration agreement did not specify the issues to be arbitrated. (Matter of National Cash Register Co. [Wilson], 8 NY2d 377; Rochester City School Dist. v Rochester Teachers Assn., 41 NY2d 578; Matter of Silverman [Benmor Coats], 61 NY2d 299; United Buying Serv. Intl. Corp. v United Buying Serv., 38 AD2d 75, 30 NY2d 822; Aigen v Giannone, 49 AD2d 562; Sisters of St. John the Baptist v Geraghty Constructor, 67 NY2d 997; Matter of Hellman [Wolbrom] 31 AD2d 477; Kingsbridge Center v Turk, 98 AD2d 664; Matter of Kozlowski v Seville Syndicate, 64 Misc 2d 109.) II. It was reversible error for the courts below to rule that the Beth Din had no authority to issue a compromise judgment. (Matter of Kozlowski v Seville Syndicate, 64 Misc 2d 109.)
   OPINION OF THE COURT

Chief Judge Wachtler.

In these proceedings petitioner seeks to vacate and respondents seek to confirm an arbitration award rendered by a Beth Din, a religious tribunal that adjudicates disputes according to Jewish law and custom. Supreme Court granted the petition to vacate the award for several reasons enumerated in a lengthy opinion (Meisels v Uhr, 145 Misc 2d 571) and the Appellate Division affirmed for the reasons stated by Supreme Court (173 AD2d 542). We conclude that the award should be confirmed and therefore reverse.

For a number of years the parties engaged in business as a partnership which owned and operated three improved parcels of real property. After disagreements arose, they entered into negotiations for the dissolution of the partnership and allocation of the assets among the partners. According to petitioner, these negotiations culminated in an agreement that respondents would convey their interest and title in the three properties to petitioner in exchange for approximately $660,000, representing respondents’ equity interest in the properties less amounts owed to petitioner. According to respondents, however, this purported agreement was the result of duress and coercion, not negotiation. They claim that the agreement was signed by them only after they were subjected to physical abuse and economic blackmail during a late-night meeting in the office of petitioner’s former attorney.

The terms of this agreement were not carried out and the parties eventually agreed, in writing, to submit "all the disputes between them and as well on [the] three buildings” to arbitration by a Beth Din. The Beth Din panel was to consist of Rabbi Abraham Meisels (no relation to petitioner) and two other rabbis to be chosen by him. The agreement, which was written in Hebrew and signed on January 21, 1988, further provided that refusal to obey the Beth Din or resort to secular courts would result in forfeiture of any right in "these assets”, presumably meaning the assets of the partnership.

On February 22, 1988, at the first session of the Beth Din, the parties signed a second agreement, denominated a "Bill of Arbitration”, by which they accepted the authority of Rabbi Meisels and the two other members of the panel appointed by him, Rabbis Silber and Ginsberg. This agreement was also written in Hebrew. According to the translation submitted to Supreme Court, in a provision which that court found to be a significant limitation on the Beth Din’s authority, the parties undertook to fulfill the judgment to be granted by the Beth Din "either by judgment or by settlement according to Jewish law, as the said judges will see fit”. On the same day, the panel ordered petitioner to deposit $500,000 (later increased to $600,000) with the Beth Din, the purpose of which the parties also dispute. Petitioner contends that the deposit was made only to insure his appearance before the Beth Din; respondents contend that it was also intended as security to be available to satisfy any judgment that might be rendered against petitioner by the panel. The deposit was finally made in a form acceptable to the Beth Din on June 9, 1988, after more than a dozen hearing sessions had taken place. At that time, the panel issued a written memorandum stating that it intended to issue a verdict within two weeks and that, if it failed to do so other than because of hindrance by petitioner, it would return petitioner’s deposit.

The final session was held on June 12. On June 23, a written award was issued which provided that petitioner would retain full ownership of the two remaining buildings (the third building had apparently been sold with the consent of all parties) and would pay to respondents the sum of $875,000, of which $600,000 was payable within two weeks and the remainder was payable in a three-month note. In addition, the award gave respondents the option to purchase one of the two buildings from petitioner within two months for a stated price.

On June 28, the Beth Din issued an appendix to the award, apparently at the request of both parties, which clarified certain aspects of the award. For example, the appendix provided that, with respect to the building subject to the option, petitioner would be entitled to the income and would be responsible for all normal expenses until the closing, but that any unusually large expenses that might be required before the closing would be passed on to respondents by adjusting the purchase price.

Also in the record is a document dated August 31, the source and nature of which is unclear. According to the translation from Hebrew, this document is a copy made by petitioner of a document shown to him by Rabbi Meisels. The translation indicates that the document was signed by all three members of the Beth Din panel. It sets forth a date and place for the exchange of releases and the payment of the sums due under the award, and notes that respondents will be accorded six weeks from that date to exercise the option. The document was never served upon the parties; according to the affidavits of two members of the Beth Din panel, it was an internal memorandum that merely reflected information imparted to the panel by the parties’ advocates concerning their plan to implement the award.

On September 8, however, petitioner commenced a proceeding to vacate the award pursuant to CPLR 7511 and seeking the return of the $600,000 deposit. Among the grounds for vacatur asserted by petitioner were that Rabbis Ginsberg and Silber were selected at the insistence of respondents and that those two members of the panel were biased and engaged in improper ex parte contacts with respondents. In addition, petitioner claimed that the award was irrational, based in part on the Beth Din’s alleged failure to give due consideration to certain evidence offered by petitioner. These grounds for vacatur were all correctly rejected by Supreme Court, which noted that petitioner’s allegations of improper conduct on the part of the arbitrators were conclusory and unsubstantiated.

Petitioner’s primary contention was that the award should be vacated pursuant to CPLR 7511 (b) (1) (iv) on the ground that his rights were prejudiced by the failure of the Beth Din to follow certain procedures set forth in CPLR article 75, in particular the requirements of CPLR 7507 and 7509. This argument was also correctly rejected by Supreme Court.

CPLR 7507 requires, in part, that an arbitration award be in writing and be delivered to each party personally or by registered or certified mail unless the arbitration agreement provides for some other method of delivery. CPLR 7509 provides that an award may be modified by the arbitrator upon certain enumerated grounds and only upon an application by a party with written notice to the other parties.

Petitioner’s claim that the Beth Din did not comply with these procedures rests on a single fragile premise — that the Beth Din’s initial award was made on June 12, not June 23. According to petitioner, this supposed June 12 award directed that petitioner would retain title to both remaining properties and that respondents would receive the sum of $875,000. Thus, the argument goes, the June 23 award, which included the additional provision granting respondents an option to purchase one of the properties, constituted a modification of the original award. Because this modification did not satisfy the requirements of CPLR 7509 — there was no written application by respondents, no notice to petitioner and none of the enumerated grounds for modification — petitioner contends that the award must be vacated.

The weak link in this argument, of course, is the absence of any documentary evidence that the Beth Din in fact rendered an award on June 12; if it did not, then the June 23 award was not a modification, the requirements of CPLR 7509 do not apply and the entire argument collapses. Petitioner’s explanation for his inability to produce the June 12 award is that he was never notified of the award and that it was never delivered to him as required by CPLR 7507. This procedural defect, petitioner contends, not only excuses his inability to substantiate the premise of his argument, but also establishes a further ground for vacating the award. We disagree.

Assuming for the sake of argument that there was some attempt to issue an award on June 12 — though Rabbis Silber and Ginsberg submitted affidavits denying that any decision had been reached on that date — petitioner’s contention that such an award was not delivered to him would, at most, vitiate that award. We must agree with the lower courts that either there was no attempt to issue an award on June 12 or, if there was, it was ineffective. In either case, the only viable award is the one dated June 23. This award, then, was not a modification of a prior award and petitioner’s arguments attacking it on that basis are without merit.

Petitioner also contended that the award was improperly modified by both the June 28 appendix to the award and the August 31 document which described a timetable for satisfaction of the award. Because these documents concern the terms of the option, the argument that they modified the award rests on the premise that the award in question is the so-called "missing award” of June 12, which did not include such an option. Our conclusion that there was no viable June 12 award largely disposes of this argument. The June 23 award is the relevant benchmark for determining whether the award was modified and, when compared with that award, the later documents did not work a modification, but at most merely clarified the terms of the option. Moreover, even assuming that a modification occurred and that the requirements of CPLR 7509 were not followed, vacatur is not required unless petitioner can demonstrate that he was prejudiced by the defect (see, CPLR 7511 [b] [1]). Petitioner has not met this burden. Indeed, the major provision of the June 28 appendix— an allowance for an upward adjustment in the option price to reflect unusual expenses — favored petitioner.

Finally, petitioner also claimed that vacatur of the award was required because "a final and definite award upon the subject matter submitted was not made” (CPLR 7511 [b] [1] [in]). This claim is based upon provisions in the June 23 award, the June 28 appendix and the August 31 memorandum indicating that the Beth Din would resolve disputes that might arise between the parties concerning the execution of the award. For example, the June 28 appendix provided that the Beth Din would decide whether unusual operating expenses required an adjustment in the option price. Supreme Court’s decision to vacate the award was based in part on the conclusion that these provisions deprived the award of finality and definiteness. We reach a different conclusion.

The Beth Din’s reservation of jurisdiction to resolve disputes that might arise as the parties undertook to satisfy the award does not necessarily mean that the award is indefinite or nonfinal for purposes of CPLR 7511 (see, Morgan Guar. Trust Co. v Solow, 114 AD2d 818, affd 68 NY2d 779). An award is deficient in this regard and subject to vacatur only if it leaves the parties unable to determine their rights and obligations, if it does not resolve the controversy submitted or if it creates a new controversy (see, Hiscock v Harris, 74 NY 108, 113; Matter of Guetta [Raxon Fabrics Corp.], 123 AD2d 40, 44). The award in this case sufficiently set forth the parties’ rights and obligations with respect to the partnership assets and left no pending dispute unresolved. The Beth Din’s reservation of jurisdiction concerned only potential disputes that might arise, not because of any indefiniteness in the award, but because of the nature of the assets in issue or because of the parties’ intransigence. For example, there was no way for the panel to foresee at the time the award was made what expenses might arise in connection with the operation of the real property between the time of the award and closing if the respondents chose to exercise the option. And, given the history of the dispute and the behavior of the parties, it was reasonable for the panel to expect that the parties would not be able to agree between themselves whether any unusual expenses were necessary. In these circumstances, the Beth Din’s retention of jurisdiction to resolve these matters if they should arise did not render the award fatally indefinite or nonfinal.

The discussion to this point disposes of all of the arguments raised by petitioner as grounds for vacating the award. Supreme Court, however, did not confine itself to these issues, but ruled in addition that the arbitration agreements were invalid because they did not specifically identify the disputes that were being submitted and that the Beth Din had not been granted the equivalent of equitable powers and therefore exceeded its authority in granting respondents an option to buy one of the properties. Because these grounds for vacatur had not been raised by petitioner, following Supreme Court’s decision respondents moved for reargument to answer these arguments.

Particularly at issue on the motion for reargument was whether the Bill of Arbitration had given the Beth Din authority to fashion an equitable compromise judgment. As noted earlier, the translation of this document submitted by respondents in opposition to the petition, when the question of the Beth Din’s equitable powers had not been raised, indicated that the Beth Din could resolve the dispute "either by judgment or by settlement according to Jewish law”.

Supreme Court, after reviewing general principles of Jewish law, had concluded that a Beth Din acquired equitable powers only by a grant of "peshara” authority — authority to reach a "compromise related to the law” as opposed to a judgment strictly according to law. Relying on the translation submitted by respondents, which referred to "settlement according to Jewish law”, the court held that the Beth Din lacked peshara authority in this case. In support of the motion for reargument, respondents submitted an affidavit from the translator noting that the Bill of Arbitration in fact used the word "peshara”. He asserted that he had chosen the word "settlement” rather than the literal translation "compromise nearest to the law” because it seemed less awkward, and that no distinction between the terms was intended.

Supreme Court granted reargument but adhered to its original determination, rejecting respondents’ attempt to clarify the translation, essentially on the ground that respondents had submitted the original translation and were therefore bound by it. The court referred to the respondents’ "hindsight attempt to substitute a different translation” as "tantamount to 'changing horses in mid-stream’ upon finding themselves 'hoisted by their own petard.’ ”

The court’s indignation was misplaced. Respondents’ need to clarify the record was no fault of their own; it was occasioned by the court’s decision to delve into issues not raised by either party. No one had raised any question about the Beth Din’s authority to reach a compromise and there was no need for respondents to be concerned about whether the translation reflected such authority until the court raised the issue sua sponte.

We have no need to resolve whether the Beth Din had authority to render a compromise judgment. Whether or not the panel was specifically granted peshara authority, the arbitration agreements were broad enough to encompass disputes concerning title to the properties owned by the partnership — in fact, the first arbitration agreement specifically identified those buildings as subjects of the arbitration.

Supreme Court’s conclusion that, in the absence of peshara authority, the arbitrators could not grant an option to respondents rested on the premise that the arbitration was in the nature of an accounting, limited to resolving disputes arising under the agreement dissolving the partnership, and that the arbitrators could not change the terms of that agreement. The arbitration agreements, however, do not support such a limited view of the scope of the arbitration. They are broad enough to bring within the purview of the arbitration respondents’ claim that the dissolution agreement was unenforceable because it was the product of duress and coercion and that, therefore, the partnership assets should be distributed in some other manner.

We also disagree with Supreme Court’s conclusion that the arbitration agreements were impermissibly vague. We note first that this issue, too, was raised by the court sua sponte. Petitioner did not challenge the validity of the arbitration agreements, and for good reason. CPLR 7511 (b) (2) (ii) recognizes such a challenge as grounds for vacatur only by one "who neither participated in the arbitration nor was served with a notice of intention to arbitrate”. Petitioner participated in the arbitration, however, thus waiving any claim that the agreement to arbitrate was invalid (Matter of Silverman [Benmor Coats], 61 NY2d 299, 307). For this reason alone, vacatur of the award cannot be justified on the basis of a supposed deficiency in the arbitration agreements.

Nevertheless, because the decision of the lower courts in this case casts doubt on the validity of broad arbitration agreements in general, and these particular agreements, which apparently are widely used in Beth Din arbitrations, we consider it appropriate to reaffirm that broad arbitration agreements are permissible. We have never required that arbitration agreements identify with specificity those disputes which are being submitted. As we noted in Matter of Weinrott (Carp) (32 NY2d 190, 196), "[s]uch a demand for specificity as to which particular issues should be submitted to the arbitrators would make the drafting of arbitration agreements burdensome, confusing and often impossible.”

The final point concerns the provisions of the arbitration agreements under which any rights in the partnership assets would be forfeited as a penalty for resorting to civil courts. Supreme Court held that these provisions violated public policy and were therefore void and unenforceable. Petitioner contends that these provisions taint the arbitration agreements to such a degree that the agreements are void in their entirety. We find it unnecessary to pass on the validity of the forfeiture provisions, inasmuch as this record reflects no attempt by the Beth Din to enforce them. Whether or not the forfeiture provisions are enforceable, however, the remaining portions of the agreements are nonetheless valid.

Accordingly, the order of the Appellate Division should be reversed, with costs, the petition in proceeding No. 1 to vacate the arbitration award denied, and the petition in proceeding No. 2 to confirm the arbitration award granted.

Judges Titone, Hancock, Jr., Bellacosa and Yesawich, Jr., concur; Judges Simons and Kaye taking no part.

Order reversed, etc.

       Proceeding No. 1 was commenced by petitioner Meisels to vacate the award. In that proceeding, respondents Alexander and Moses Uhr asserted a counterclaim for an order confirming the award. In addition, as a protective measure, since petitioner Meisels contended that the counterclaim was not properly asserted, the Uhrs commenced proceeding No. 2 also seeking to confirm the award. In this second proceeding, the Uhrs are petitioners and Meisels is the respondent. For ease of reference, however, this opinion will refer to the parties according to the caption in the first proceeding — i.e., Meisels is the petitioner and the Uhrs are the respondents.

       Designated pursuant to NY Constitution, article VI, § 2.


author: Kaye, J.

text:
    Beverly Sommer et al., Respondents-Appellants, v Federal Signal Corporation et al., Respondents-Appellants, and Holmes Protection, Inc., Appellant-Respondent, et al., Defendant. (And a Third-Party Action and All Related Consolidated Actions.)
    Argued and submitted March 25, 1992;
    decided May 12, 1992

      POINTS OF COUNSEL

      Kenneth Kirschenbaum, Ira Levine and Steven L. Alter for appellant-respondent. I.
    Gross negligence cannot be established as a matter of law. (Alter v Advance Alarm, Co., 131 AD2d 406; Feldman Furs v Jewelers Protection Servs., 134 AD2d 171; Nuri Farhardi, Inc. v Albany Ins. Co., 137 AD2d 429; Sue & Sam Mfg. Co. v United Protective Alarm Sys., 119 AD2d 664; Halsted v Postal Tel. Cable Co., 193 NY 293; Hazzard v Chase Natl. Bank, 159 Misc 57, 257 App Div 950, 282 NY 652, 311 US 708; Hong Kong Export Credit Ins. Corp. v Dun & Bradstreet, 414 F Supp 153; Veals v Consolidated Edison Co., 114 Misc 2d 626; Doe v New York City Dept. of Social Servs., 649 F2d 134.) II. The limitation of liability clause does not violate public policy and should be enforced even if gross negligence is alleged. (Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220; Failla v A. F. A. Protective Sys., 139 AD2d 653; Straus & Co. v Canadian Pac. Ry. Co., 254 NY 407; Proctor Troy Props. Co. v Dugan Store, 191 App Div 685; Berger v Dynamic Imports, 51 Misc 2d 988; Koos Van Den Akker Atelier v Honeywell Protection Servs., 148 AD2d 359; Gentile v Garden City Alarm Co., 147 AD2d 124; Hanover Ins. Co. v D & W Cent. Sta. Alarm Co., 164 AD2d 112; Arell’s Fine Jewelers v Honeywell, Inc., 147 AD2d 922; Melodee Lane Lingerie Co. v American Dist. Tel. Co., 18 NY2d 57.) III. The causes of action alleging negligence, strict liability and breach of warranty were properly dismissed. (Florence v Merchants Cent. Alarm Co., 51 NY2d 793; Clark-Fitzpatrick, Inc. v Long Is. R. R. Co., 70 NY2d 382; World Trade Knitting Mills v Lido Knitting Mills, 154 AD2d 99; Channel Master Corp. v Aluminium Ltd. Sales, 4 NY2d 403; Cruz v Commonwealth Land Tit. Ins. Co., 157 AD2d 333; Perlmutter v Beth David Hosp., 308 NY 100; Milau Assocs. v North Ave. Dev. Corp., 56 AD2d 587, 42 NY2d 482; Aegis Prods. v Arriflex Corp., 25 AD2d 639; Craig v American Dist. Tel. Co., 91 Misc 2d 1063.) IV. The negligence claims were properly dismissed because the contract between the parties contains an exculpatory clause which relieves Holmes from liability. (Florence v Merchants Cent. Alarm. Co., 51 NY2d 793; Nuri Farhardi, Inc. v Albany Ins. Co., 137 AD2d 429; Feldman Furs v Jewelers Protection Servs., 134 AD2d 171; Ciofalo v Vic Tanney Gyms, 10 NY2d 294; Advance Burglar Alarm Sys. v D'Auria, 110 AD2d 860; Sue & Sam Mfg. Co. v United Protective Alarm Sys., 119 AD2d 664; Dubovsky & Sons v Honeywell, Inc., 89 AD2d 993; H. G. Metals v Wells Fargo Servs., 45 AD2d 490; El Chami v Automatic Burglar Alarm Corp., 106 Misc 2d 559.) V. Codefendants are not entitled to contribution or indemnification from Holmes. (Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220; Smith v Sapienza, 52 NY2d 82; Moch Co. v Rensselaer Water Co., 247 NY 160; Board of Educ. v Sargent, Webster, Crenshaw & Folley, 71 NY2d 21; SSDW Co. v Feldman-Misthopoulos Assocs., 151 AD2d 293; Blum v Good Humor Corp., 57 AD2d 911; McCabe v Century Theatres, 25 AD2d 154; McFall v Compagnie Mar. Belge, 304 NY 314; County of Westchester v Becket Assocs., 102 AD2d 34, 66 NY2d 642; Shufelt v Niagara Mohawk Power Corp., 109 AD2d 66.)

      Charles J. Moxley, Jr., Michelle J. France, Gareth D. Bye and Peter M. Christel for Beverly Sommer and another, respondents-appellants. I.
    The limitation of liability clause in the Holmes contract is unenforceable as against Holmes’ gross negligence. (Gross v Sweet, 49 NY2d 102; Kalisch-Jarcho, Inc. v City of New York, 58 NY2d 377; Ash v New York Univ. Dental Center, 164 AD2d 366; Graphic Scanning Corp. v Citibank, 116 AD2d 22; Valuable Holding Corp. v Midtown Vault Corp., 120 AD2d 356; Modern Settings v American Dist. Tel. Co., 121 AD2d 266; Koos Van Den Akker Atelier v Honeywell Protection Servs., 148 AD2d 359; Hanover Ins. Co. v D & W Cent. Sta. Alarm Co., 164 AD2d 112; Gentile v Garden City Alarm Co., 147 AD2d 124; Idone v Pioneer Sav. & Loan Assn., 159 AD2d 560.) II. 810 Associates came forward with sufficient evidentiary facts to require a trial on the issue of gross negligence. (United States v Diebold, Inc., 369 US 654; Federal Ins. Co. v Honeywell, Inc., 641 F Supp 1560; Food Pageant v Consolidated Edison Co., 54 NY2d 167; Hazzard v Chase Natl. Bank, 159 Mise 57, 257 App Div 950, 282 NY 652, 311 US 708; Seybel v National Currency Bank, 54 NY 288; Dalton v Hamilton Hotel Operating Co., 242 NY 481; Kalisch-Jarcho, Inc. v City of New York, 58 NY2d 377; Veals v Consolidated Edison Co., 114 Mise 2d 626; Matter of Jenson v Fletcher, 277 App Div 454, 303 NY 639; Weld v Postal Tele

      graph-Cable Co., 199 NY 88.) III. Overriding public interest and safety considerations preclude a fire alarm company’s disclaimer or limitation of liability for its own negligence. (Johnston v Fargo, 184 NY 379; Conklin v Canadian-Colonial Airways, 266 NY 244; Ash v New York Univ. Dental Center, 164 AD2d 366; Ciofalo v Vic Tanney Gyms, 10 NY2d 294; Burke v Avis Corp., 104 Misc 2d 826; Rinaldi & Sons v Wells Fargo Alarm Serv., 39 NY2d 191; Florence v Merchants Cent. Alarm Co., 51 NY2d 793.) IV. The Holmes contract does not clearly and explicitly limit Holmes’ liability for gross negligence or ordinary negligence. (Gross v Sweet, 49 NY2d 102; Quinones v Waldbaum’s Inc., 98 AD2d 674; Boll v Sharp & Dohme, 281 App Div 568, 306 NY 669, 307 NY 646; Johnston v Fargo, 98 App Div 436, 184 NY 379; Eden Music Corp. v Times Sq. Music Publs. Co., 127 AD2d 161; Scutti Pontiac v Rund, 92 Misc 2d 881; Stevens Inst. of Technology v United States, 396 F Supp 986.) V. The exculpatory and limitation of liability clauses are unenforceable as against gross negligence under General Obligations Law § 5-323. (Melodee Lane Lingerie Co. v American Dist. Tel. Co., 18 NY2d 57; 80-82 Greene St. Corp. v AFA Protective Sys., 100 Misc 2d 334; Federal Ins. Co. v Honeywell, Inc., 641 F Supp 1560.) VI. Holmes’ argument that 810 Associates’ noncontractual claims are barred is without merit. (Clark-Fitzpatrick, Inc. v Long Is. R. R. Co., 70 NY2d 382; Wrigley Co. v Waters, 890 F2d 594; Ajax Hardware Mfg. Corp. v Industrial Plants Corp., 569 F2d 181; Cheek v Williams-McWilliams Co., 697 F2d 649; Consolidated Edison Co. v Westinghouse Elec. Corp., 567 F Supp 358; Robbins v Ogden Corp., 490 F Supp 801; Sears, Roebuck & Co. v Enco Assocs., 43 NY2d 389; White v Guarente, 43 NY2d 356; Matter of Paver & Wildfoerster [Catholic High School Assn.], 38 NY2d 669; Lord Elec. Co. v Barber Asphalt Paving Co., 226 NY 427.) VII. 810 Associates came forward with sufficient evidentiary facts to require a trial on the issues of breach of warranty and strict liability. (Winckel v Atlantic Rentals & Sales, 159 AD2d 124; Industralease Automated & Scientific Equip. Corp. v R. M. E. Enters., 58 AD2d 482; Laudisio v Amoco Oil Co., 108 Misc 2d 245; Barco Auto Leasing Corp. v PSI Cosmetics, 125 Misc 2d 68; Farm Automation Corp. v Senter, 84 AD2d 757; Back O’Beyond v Telephonic Enters., 76 AD2d 897; Consolidated Edison Co. v Westinghouse Elec. Corp., 567 F Supp 358; Butler v Pittway Corp., 770 F2d 7; Atlantic Tug & Equip. Co. v S & L Paving Corp., 40 AD2d 589; Milau Assocs. v North Ave. Dev. Corp., 42 NY2d 482.) VIII. 810 Associates’ cross claims for contribution survive independently of its primary claims. (Garrett v Holiday Inns, 58 NY2d 253; Dutton v Mitek Realty Corp., 95 AD2d 769; McHam v Whitney, 143 Misc 2d 441; Welch v Grant Dev. Co., 120 Misc 2d 493; McCallin v Walsh, 64 AD2d 46, 46 NY2d 808; Franzek v Calspan Corp., 78 AD2d 134; City of New York v Bettigole, 57 AD2d 797.) IX. Summary judgment is inappropriate where there is substantial discovery remaining to be conducted. (Terranova v Emil, 20 NY2d 493; Integrated Logistics Consultants v Fidata Corp., 131 AD2d 338.)

      Chester J. Wrobleski, Elizabeth T. Marren and Brian D. Pattison for Infotech Management, Inc., and another, respondents-appellants.
    I. A negligent defendant must contribute his equitable share of damages paid by codefendants even though a contract between plaintiff and the negligent defendant limits his liability to plaintiff. (Bartsch v Bartsch, 54 AD2d 940; Bray v Johnson, 284 App Div 904; Velez v Craine & Clark Lbr. Corp., 33 NY2d 117; Fendley v Power Battery Co., 167 AD2d 260; Dole v Dow Chem. Co., 30 NY2d 143; Scaccia v Wallin, 121 AD2d 709; Trustees of Columbia Univ. v Mitchell/Giurgola Assocs., 109 AD2d 449; Franzek v Calspan Corp., 78 AD2d 134; Londino v Health Ins. Plan, 93 Misc 2d 18; Fleischer v Uccelini, 81 Misc 2d 22.) II. Contrary to the trial court’s decision, a cross claimant may state a valid claim for contribution without alleging that he is owed a duty in contract or tort by the party from whom contribution is sought. (Nassau Roofing & Sheet Metal Co. v Facilities Dev. Corp., 71 NY2d 599; Trustees of Columbia Univ. v Mitchell/Giurgola Assocs., 109 AD2d 449; Hasley Trucking Co. v Great Lakes Pipe Co., 101 AD2d 1019; Lawrence v Fox, 20 NY 268; Haigler v City of New York, 135 AD2d 362; Paradiso v Apex Investigators & Sec. Co., 91 AD2d 929; Bernal v Pinkerton’s, Inc., 52 AD2d 760, 41 NY2d 938; Moch Co. v Rensselaer Water Co., 247 NY 160; Strauss v Belle Realty Co., 65 NY2d 399; Einhorn v Seeley, 136 AD2d 122.) III. Holmes wrongly argues that there is insufficient evidence of its gross negligence to defeat its motion for summary judgment and that, in any event, a limitation of liability clause is valid as to claims based on its gross negligence. (Seagroatt Floral Co. v New York Tel. Co., 76 AD2d 1038; Austro v Niagara Mohawk Power Corp., 103 AD2d 903, 66 NY2d 674; Lane v New York Tel. Co., 7 AD2d 702; Federal Ins. Co. v Honeywell, Inc., 641 F Supp 1560; Veals v Consolidated Edison Co., 114 Misc 2d 626;
      Cauble v Mabon Nugent & Co., 594 F Supp 985; Food Pageant v Consolidated Edison Co., 54 NY2d 167; Dalton v Hamilton Hotel Operating Co., 242 NY 481; Weld v Postal Telegraph-Cable Co., 210 NY 59; Rand & Paseka Mfg. Co. v Holmes Protection, 130 AD2d 429, 70 NY2d 615.) IV. Holmes’ arguments for avoiding contribution are without merit both as to the main action and the tenant actions. (Wrigley Co. v Waters, 890 F2d 594; Robbins v Ogden Corp., 490 F Supp 801; Sears, Roebuck & Co. v Eneo Assocs., 43 NY2d 389; White v Guarente, 43 NY2d 356; Cruz v Commonwealth Land Tit. Ins. Co., 157 AD2d 333; Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220; Roginsky v Richardson-Merrell, Inc., 378 F2d 832.)

      Randall S. D. Jacobs and Robert J. Fryman for Walker Thomas Associates, Ltd., respondent-appellant.
    I. The court below erred in affirming the dismissal of codefendants’ cross claims for contribution based on Holmes’ negligent conduct. (Stein v Whitehead, 40 AD2d 89; Pascual v Mercado, 44 AD2d 560; Helmrich v Lilly & Co., 89 AD2d 441; Board of Educ. v Sargent, Webster, Crenshaw & Folley, 71 NY2d 21; Robbins v Ogden Corp., 490 F Supp 801; Rich v New York Cent. & Hudson Riv. R. R. Co., 87 NY 382; Rosenbaum v Branster Realty Corp., 276 App Div 167; North Shore Bottling Co. v Schmidt & Sons, 22 NY2d 171; SSDW Co. v Feldman-Misthopoulos Assocs., 151 AD2d 293.) II. The court below was correct in reinstating the cause of action alleging gross negligence. (Gross v Sweet, 49 NY2d 102; Kalisch-Jarcho, Inc. v City of New York, 58 NY2d 377; Gentile v Garden City Alarm Co., 147 AD2d 124; Arell’s Fine Jewelers v Honeywell, Inc., 147 AD2d 922; Idone v Pioneer Sav. & Loan Assn., 159 AD2d 560; Hanover Ins. Co. v D & W Cent. Sta. Alarm Co., 164 AD2d 112; Federal Ins. Co. v Honeywell, Inc., 641 F Supp 1560; Weld v Postal Telegraph-Cable Co., 199 NY 88; Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220.) III. A jury would have sufficient basis to find that Holmes’ conduct of ignoring a fire alarm signal which it had agreed to monitor constituted gross negligence. (Simpson v Term Indus., 126 AD2d 484; Gale v Kessler, 93 AD2d 744; Integrated Logistics Consultants v Fidata Corp., 131 AD2d 338; Ugarriza v Schmieder, 46 NY2d 471; Johannsdottir v Kohn, 90 AD2d 842; Lane v New York Tel. Co., 7 AD2d 702; Seagroatt Floral Co. v New York Tel. Co., 76 AD2d 1038; Federal Ins. Co. v Honeywell, Inc., 641 F Supp 1560; Veals v Consolidated Edison Co., 114 Misc 2d 626;
      Denmark v New York Tel. Co., 97 Misc 2d 205, 103 Misc 2d 1055.)

      John F. Triggs for Federal Signal Corporation and others, respondents-appellants.
   OPINION OF THE COURT

Kaye, J.

This appeal, in consolidated actions against a fire alarm company for negligent services resulting in extensive property damage, centers on an exculpatory clause in the company’s contract with its customer. For the reasons that follow, we conclude that the clause would not bar recovery by the customer for the company’s grossly negligent conduct; that an issue of fact regarding gross negligence precludes summary judgment for the company; and that, as to the contribution claims asserted against the company, some should be conditionally reinstated while others were properly dismissed.

I.

In 1985, 810 Associates owned a 42-story skyscraper in midtown Manhattan. As required by local law, the building was equipped with a central station fire alarm system. 810 contracted with Holmes Protection, Inc. to provide central station monitoring service — meaning that at its central station Holmes would receive any alarms sounded on 810’s premises and immediately notify the fire department.

On the morning of Saturday, April 13, an 810 employee called Holmes to ask that the alarm system be deactivated because of work being done at the building. When Holmes temporarily takes a subscriber’s system out of service, or deactivates the system, Holmes continues to receive signals but simply does not report them to the fire department. In these circumstances, additionally, Holmes’ practice is to restore normal service within several hours unless the subscriber directs otherwise. Thus, Holmes deactivated 810’s system on Saturday morning as requested, and reactivated it on Saturday night.

On Monday morning, April 15, 810’s chief engineer, unaware that service had already been restored, telephoned Holmes to request reactivation. Holmes’ dispatcher — allegedly an untrained, inexperienced substitute — initially understood that 810 wanted normal service restored. But as the brief conversation proceeded, the dispatcher became confused by the caller’s repeated insistence that he would "activate” the system and the dispatcher concluded — without attempting to elicit greater clarification from the caller, or any other confirmation — that 810 wanted its system taken out of service.

Seven to nine minutes later, Holmes began receiving fire signals from the building. However, consistent with his mistaken impression that the system was to be taken out of service, the dispatcher simply assumed that he should ignore those signals. In fact, a four-alarm fire had started on the 28th floor, which was reported directly to the fire department by others — but not until minutes after the signals were first received by Holmes.

A spate of lawsuits followed. 810 sued Holmes and others connected with its fire detection system — designers, manufacturers, parts suppliers, installers, inspectors — for damages exceeding $7 million, on the theory that a small, containable fire had spread out of control because the fire detection system failed to timely detect the fire, and spread even further because of Holmes’ failure to transmit the alarm to the fire department. Tenants sued 810, Holmes and other alarm-related entities, and 810 and the alarm defendants sought contribution from Holmes.

The actions were consolidated, and after discovery Holmes sought summary judgment dismissing all claims. As an affirmative defense against 810’s negligence and breach of contract causes of action, Holmes relied on a contractual exculpatory clause which provided:

"Holmes shall not be liable for any of [810’s] losses or damages * * * caused by performance or nonperformance of obligations imposed by this contract or by negligent acts or omissions by Holmes.”

Alternatively, Holmes relied on a contract clause that limited its liability to the lesser of $250 or 10% of the annual service charge "as liquidated damages.”

Although concluding that the exculpatory clause would be unenforceable if Holmes was grossly negligent, Supreme Court characterized the circumstances of April 15 as merely a "misadventure, flowing from a high water mark of mis-communication,” presenting no triable issue of gross negligence, and it dismissed 810’s claims against Holmes. The court also dismissed the tenants’ claims and all contribution claims against Holmes, finding that none of the parties asserting those claims were third-party beneficiaries of the 810/Holmes contract or otherwise owed a duty by Holmes.

Taking a different view of the evidence, the Appellate Division held that there was a triable issue of fact as to Holmes’ gross negligence, and further ordered that the contribution claims be reinstated should Holmes be found grossly negligent at trial. While agreeing with the Appellate Division on the issue of gross negligence, we conclude that the court erred in its contribution analysis and therefore modify the order and answer the certified questions in the negative.

II.

Initially, we must determine whether 810 may pursue tort claims against Holmes, or is limited to breach of contract remedies. Holmes argues that its duties to 810 arose solely from its contractual undertaking and thus this case at most presents a breach of contract. 810 counters that grossly negligent fire alarm service threatens life and property and is actionable under traditional tort law. Resolution of this threshold issue affects the negligence claims and the availability of contribution.

Some claims plainly sound in tort — for example, the case of a pedestrian struck by a careless driver. Others are clearly contract, like the case of the merchant who fails to deliver goods as promised. In the former case, the duty breached — to drive carefully — is one not imposed by contract but by law as a matter of social policy (see, Prosser, Torts, at 613 [4th ed]). In the latter, the duties arise solely from the parties’ consensual undertaking (id.).

This case partakes of both categories, and thus falls in the borderland between tort and contract, an area which has long perplexed courts. As we observed more than a century ago:

"Between actions plainly ex contractu and those as clearly ex delicto there exists what has been termed a border-land, where the lines of distinction are shadowy and obscure, and the tort and the contract so approach each other, and become so nearly coincident as to make their practical separation somewhat difficult.”

(Rich v New York Cent. & Hudson Riv. R. R. Co., 87 NY 382, 390; see also, Matter of Paver & Wildfoerster [Catholic High School Assn.], 38 NY2d 669, 678; Prosser, Selected Topics on the Law of Torts, ch VII, The Borderland of Tort and Contract [1953] [hereinafter Borderland]; Note, The Elastic Concept of Tort and Contract As Applied By the Courts of New York, 14 Brooklyn L Rev 196 [1948].)

These borderland situations most often arise where the parties’ relationship initially is formed by contract, but there is a claim that the contract was performed negligently. That is the case here. Holmes owed no duty to 810 prior to their contract; once they had contracted, however, Holmes had certain obligations to 810, including a duty to make timely reports to the fire department. The question is whether Holmes’ failure to report, allegedly the result of negligence, is a breach of contract, a tort, or both.

Though the line separating tort and contract claims may be elusive, the classification can be consequential, affecting for example the applicable Statute of Limitations, requisite proof and measure of damages. In the present case, classification of 810’s claims bears most directly on the availability of contribution.

This Court has identified several guideposts for separating tort from contract claims.

In North Shore Bottling Co. v Schmidt & Sons (22 NY2d 171, 179), we recognized that "a contracting party may be charged with a separate tort liability arising from a breach of a duty distinct from, or in addition to, the breach of contract.” A tort may arise from the breach of a legal duty independent of the contract, but merely alleging that the breach of a contract duty arose from a lack of due care will not transform a simple breach of contract into a tort (Clark-Fitzpatrick, Inc. v Long Is. R. R. Co., 70 NY2d 382, 389; Rich v New York Cent. & Hudson Riv. R. R. Co., 87 NY, at 398, supra).

A legal duty independent of contractual obligations may be imposed by law as an incident to the parties’ relationship. Professionals, common carriers and bailees, for example, may be subject to tort liability for failure to exercise reasonable care, irrespective of their contractual duties (Rich v New York Cent. & Hudson Riv. R. R. Co., 87 NY, at 399, supra; Prosser, Borderland, op. cit., at 402-405). In these instances, it is policy, not the parties’ contract, that gives rise to a duty of due care (see, Prosser, Torts, at 613 [4th ed]).

In disentangling tort and contract claims, we have also considered the nature of the injury, the manner in which the injury occurred and the resulting harm (see, Bellevue S. Assocs. v HRH Constr. Corp., 78 NY2d 282, 293-295). In Bellevue, we rejected plaintiff’s attempt to ground in tort a claim that defendants supplied defective floor tiles, noting that the injury (delamination of tiles) was not personal injury or property damage; there was no abrupt, cataclysmic occurrence; and the harm was simply replacement cost of the product. Thus, where plaintiff is essentially seeking enforcement of the bargain, the action should proceed under a contract theory (id.; Clark-Fitzpatrick, Inc. v Long Is. R. R. Co., 70 NY2d, at 389-390, supra).

Finally, we recently acknowledged that the labels “misfeasance” and "nonfeasance” — once dispositive — should not be controlling (Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220, 226). Nonfeasance (or failure to perform a duty) was traditionally viewed as breach of contract, misfeasance (or defective performance) a matter of tort (see, Melodee Lane Lingerie Co. v American Dist. Tel. Co., 18 NY2d 57; World Trade Knitting Mills v Lido Knitting Mills, 154 AD2d 99, 105-106, and cases cited therein [alarm cases]; Prosser, Torts, at 614-618 [4th ed]). As we noted in Eaves Brooks, this distinction is largely semantical and often illogical — negligent performance may be a result of failing to act as well as doing an affirmative act improperly (see, Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d, at 226, supra).

With these guideposts in mind, we conclude that 810’s claims against Holmes are not limited to breach of contract but may also sound in tort.

Holmes’ duty to act with reasonable care is not only a function of its private contract with 810 but also stems from the nature of its services. New York City’s comprehensive scheme of fire-safety regulations requires certain buildings— including 810’s — to have central station fire service (Administrative Code of City of New York § C26-1704.5 [f], [g] [now § 27-972 (f), (g)]). Central station operators, in turn, are franchised and regulated by the City, and may be penalized for failing to transmit alarm signals, provide qualified operators, and other acts and omissions (New York City Fire Department Bureau of Fire Prevention, Directive 2-83 [Aug. 8, 1983]). Fire alarm companies thus perform a service affected with a significant public interest; failure to perform the service carefully and competently can have catastrophic consequences. The nature of Holmes’ services and its relationship with its customer therefore gives rise to a duty of reasonable care that is independent of Holmes’ contractual obligations.

Our conclusion rests as well on the manner in which the injury arose in this case and the resulting harm, both typical of tort claims. In contrast to the tile purchaser in Bellevue or the general contractor in Clark-Fitzpatrick, 810 is not seeking the benefit of its contractual bargain, but instead seeks recovery of damages for a fire that spread out of control — the sort of "abrupt, cataclysmic occurrence” referred to in Bellevue.

Having concluded the 810’s claims lie in tort as well as contract, we next consider the effect of the contractual clauses limiting Holmes’ liability to its customer.

III.

As an affirmative defense to 810’s claims, Holmes relies on the contractual exculpatory and limitation of liability clauses, urging that its liability should be limited to $55.50. We agree with the Appellate Division that the clauses are unenforceable against gross negligence and that there is an issue of fact as to Holmes’ gross negligence.

Absent a statute or public policy to the contrary, a contractual provision absolving a party from its own negligence will be enforced (Melodee Lane Lingerie Co. v American Dist. Tel. Co., 18 NY2d 57, 69, supra; Ciofalo v Vic Tanney Gyms, 10 NY2d 294, 297-298). Thus, we have previously upheld contractual language in an alarm contract limiting the customer’s damages to $50 (Florence v Merchants Cent. Alarm. Co., 51 NY2d 793), and indeed have suggested that limitations on liability help keep alarm services affordable (Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d, at 227, supra). Holmes’ exculpatory clause is therefore enforceable against claims of ordinary negligence.

It is the public policy of this State, however, that a party may not insulate itself from damages caused by grossly negligent conduct (Kalisch-Jarcho, Inc. v City of New York, 58 NY2d 377, 384-385; Gross v Sweet, 49 NY2d 102, 106). This applies equally to contract clauses purporting to exonerate a party from liability and clauses limiting damages to a nominal sum.

Gross negligence, when invoked to pierce an agreed-upon limitation of liability in a commercial contract, must "smack[ ] of intentional wrongdoing” (Kalisch-Jarcho, Inc. v City of New York, 58 NY2d, at 385, supra). It is conduct that evinces a reckless indifference to the rights of others (id.; see also, Restatement [Second] of Contracts § 195 [1] [intentional or reckless conduct vitiates contractual term limiting liability]).

In a related context, the Legislature has expressly adopted a reckless indifference standard. Under CPLR article 16, a joint tortfeasor whose culpability is 50% or less is not jointly liable for all of plaintiff’s noneconomic damages, but severally liable for its proportionate share (CPLR 1601 [1]). This limitation of liability, however, does not apply to a person who acted with "reckless disregard for the safety of others.” (CPLR 1602 [7].)

Just such a standard is applicable here. We therefore conclude — as did the trial court and Appellate Division — that while Holmes’ exculpatory and limitation of liability clauses are enforceable against claims of ordinary negligence, those clauses cannot restrict Holmes’ liability for conduct evincing a reckless disregard for its customers’ rights.

The court’s role on a motion for summary judgment is to determine whether there is a material factual issue to be tried, not to resolve it (Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395, 404). The motion should be granted only if the movant is entitled to judgment as a matter of law (see, Ugarriza v Schmieder, 46 NY2d 471, 474). Where different conclusions can reasonably be drawn from the evidence, the motion should be denied (see, Siegel, NY Prac, at 407 [2d ed]). That is the case here.

Holmes’ view of the evidence is that the company’s conduct did not rise to the level of reckless indifference. Holmes urges that the dispatcher’s failure to report the alarms was the result of a mere miscommunication, a mistake caused in part by the engineer’s confusing instructions. Another reasonable view of the evidence, however, is propounded by 810: that instead of pausing to dispel any confusion surrounding the subscriber’s instruction to activate its system, the dispatcher — without verification or investigation — rushed to his own conclusion, recklessly indifferent to the consequences that might flow from a misperception.

Whether this indeed is a case of a simple mistake or reckless indifference is for a jury to determine. The Appellate Division therefore properly reversed Supreme Court’s grant of summary judgment in Holmes’ favor.

IV.

In addition to 810’s direct claims for damages, essentially two classes of contribution claims have been asserted against Holmes: first, the other alarm defendants seek contribution from Holmes in the event they are found liable to 810 in its action, and second, 810 seeks contribution from Holmes in the event it is found liable to the tenants in their actions. All contribution claims were dismissed by Supreme Court, but certain of those claims were reinstated by the Appellate Division contingent on a finding at trial that Holmes was grossly negligent. We conclude that certain of those claims were correctly dismissed, and others should be reinstated.

Contribution enables a joint tortfeasor that has paid more than its equitable share of damages to recover the excess from the other tortfeasors. The need for contribution arises from the rule of law that tortfeasors generally are jointly and severally liable for a judgment, meaning that each is responsible for the full amount regardless of culpability.

At common law there was no contribution. Plaintiff could recover the entire judgment from any of the tortfeasors — even one only slightly at fault — and defendant was without recourse. Indeed, plaintiff was not even required to sue all the wrongdoers.

Two developments in the law of contribution, neither altogether satisfactory, preceded our landmark decision in Dole v Dow Chem. Co. (30 NY2d 143). First, a statute permitted pro rata apportionment of the loss against tortfeasors subject to the same judgment (CPLR former 1401, repealed by L 1974, ch 742, § 1). But the efficacy of this statute depended on the willingness of plaintiff to sue all wrongdoers — defendants had no mechanism for impleading culpable parties. Moreover, the apportionment was purely pro rata, not in proportion to fault. Second, the "active-passive” test, developed by case law, permitted a defendant who was "passively” negligent to implead an "active” tortfeasor. But the contribution was always 100% (in effect, full indemnification), and the test was sometimes difficult to apply.

Dole v Dow, and its subsequent codification as CPLR article 14, reformed the contribution rules, making them more equitable. Any tortfeasor who pays more than its fair share of a judgment — as apportioned by the factfinder in terms of relative culpability — may recover the excess from the others (CPLR 1401, 1402). Moreover, a defendant may implead another wrongdoer and claim contribution in the main action, or may seek contribution in a separate action (CPLR 1403). Although plaintiffs’ rights are generally unaffected (see, CPLR 1404 [a]), the loss is more equitably distributed among the culpable parties, according to their degree of fault. The goal of contribution, as announced in Dole and applied since, is fairness to tortfeasors who are jointly liable.

Against this background, we turn to the two classes of contribution claims asserted against Holmes.

Alarm Defendants’ Contribution Claims Against Holmes

In 810’s suit against Holmes and other alarm-related entities, the alarm-related defendants seek contribution from Holmes in the event they are found liable.

Holmes first claims that its liability to 810 can only be for breach of contract, and citing Board of Educ. v Sargent, Webster, Crenshaw & Folley (71 NY2d 21) contends that contribution is unavailable. While Sargent makes clear that contribution does not lie in contract cases, 810’s claim — as previously discussed — also sounds in tort. The nature of this action therefore does not of itself bar contribution.

Holmes further argues that it owed no duty — contractual or otherwise — to these defendants, and therefore cannot be required to contribute to a judgment. In Schauer v Joyce (54 NY2d 1), we rejected just such a contention. There, the plaintiff (Mrs. Schauer) sued attorney Joyce for legal malpractice, and he in turn impleaded attorney Gent, who handled the matter after Joyce’s discharge and allegedly aggravated the situation. We held:

"Gent maintains that he was not in contractual privity with appellant Joyce and that there is no other basis on which it can be said that he owed a duty to Joyce. This misses the point. The relevant question under CPLR 1401 and Dole is not whether Gent owed a duty to Joyce, but whether Gent and Joyce each owed a duty to Mrs. Schauer, and by breaching their respective duties contributed to her ultimate injuries.”

(Id., at 5; see also, Nassau Roofing & Sheet Metal Co. v Facilities Dev. Corp., 71 NY2d 599; Rosner v Paley, 65 NY2d 736, 738.) As we noted in Rogers v Dorchester Assocs. (32 NY2d 553, 564): "The rule of apportionment applies when two or more tort-feasors have shared, albeit in various degrees, in the responsibility by their conduct or omissions in causing an accident, in violation of the duties they respectively owed to the injured person.”

That Holmes owed no duty to the alarm defendants is thus immaterial if it breached a duty it owed to the injured person — plaintiff 810 — and thereby contributed to 810’s injury. In that we have concluded Holmes did owe such a duty, plainly the alarm defendants may seek contribution from Holmes.

The question remains whether contribution is activated only upon a finding that Holmes was grossly negligent (as the Appellate Division concluded) or whether a finding of ordinary negligence would suffice.

In contribution cases, we have drawn a distinction between the absence of liability to an injured party, and the absence of a duty (see, e.g., Garrett v Holiday Inns, 58 NY2d 253, 259). Often, the absence of direct liability to plaintiff is merely the result of a special defense, such as the Statute of Limitations or the exclusivity of workers’ compensation, and not because defendant was free of fault (see, e.g., Garrett v Holiday Inns, supra; Klinger v Dudley, 41 NY2d 362). In such cases, we have held that codefendants may seek contribution from the joint wrongdoer, despite the wrongdoer’s own defense to plaintiff’s claim. This principle is fully in accord with the rationale of Dole, which promotes equitable distribution of the loss in proportion to actual fault.

To the extent Holmes’ exculpatory clause insulates it from liability for ordinary negligence, we view it as akin to a special defense that does not affect the codefendants’ ability to obtain contribution. Although Holmes’ direct liability to 810 (by virtue of the exculpatory clause) is triggered only upon gross negligence, its duty is to avoid ordinary negligence. Upon breach of that duty, fairness requires that Holmes contribute to the judgment in proportion to its culpability. Indeed, it would be patently unfair to abrogate the alarm-related defendants’ right to contribution based on an exculpatory clause to which they were not a party (see, Franzek v Calspan Corp., 78 AD2d 134).

The alarm-related defendants also seek contribution from Holmes in the tenant actions. Holmes did not have a duty to the tenants (see, Eaves Brooks Costume Co. v Y.B.H. Realty Corp., supra), nor did it have a duty to the alarm defendants. Those contribution claims were thus properly dismissed.

810’s Contribution Claims Against Holmes

In the actions it is defending against tenants, 810 seeks contribution from Holmes. Holmes argues that since it owes no duty to the plaintiff tenants (see, Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 NY2d 220, supra), it cannot be forced to contribute to a judgment they may obtain against 810. While contribution is usually predicated on breach of a duty to plaintiff, we have also recognized that contribution may be based on a duty owing defendant.

In Garrett v Holiday Inns (58 NY2d 253, supra), a motel fire led to lawsuits by guests against the motel and the town. We found that the town had no duty to the guests upon which it could be sued, and affirmed dismissal of the complaint against it (Garrett v Town of Greece, 55 NY2d 774, affg on opn below 78 AD2d 773). The motel nevertheless sought contribution from the town in the actions it was defending against the guests, claiming that the town owed it an independent, special duty. We held that contribution was available:

"If an independent obligation can be found on the part of a concurrent wrongdoer to prevent foreseeable harm, he should be held responsible for the portion of the damage attributable to his negligence, despite the fact that the duty violated was not one owing directly to the injured person.” (58 NY2d, at 261.)

In Garrett, it was the town’s duty to the defendant motel, not to the plaintiff guests, that triggered the motel’s right to contribution. Similarly, Holmes’ duty to 810 requires it to contribute, in proportion to its fault, to any judgment obtained by the tenants against 810.

Here too there is an issue whether the obligation to contribute attaches upon a finding of gross negligence or ordinary negligence. Where a defendant agrees in advance to waive contribution from a codefendant, that agreement is enforceable to the extent it does not affect the rights of one not a party to the agreement (see, Rogers v Dorchester Assocs., 32 NY2d 553, 564, supra). However, in the absence of such agreement (or in the case of an unenforceable agreement), the usual rule applies — contribution is triggered upon a finding of ordinary negligence.

In Melodee Lane (18 NY2d, at 68, supra), we held that an alarm customer’s right to indemnification from the alarm company was circumscribed by the contract’s limitation of liability, but found the limitation unenforceable; therefore the customer’s right to indemnity was unaffected. We reach a similar result here. As the Appellate Division correctly concluded, Holmes would have to contribute to the judgment against 810 only if it were found grossly negligent.

In sum, with respect to 810’s action against Holmes, the Appellate Division correctly denied summary judgment for Holmes; the contribution claims of the alarm-related defendants should be reinstated on a finding of ordinary negligence. With respect to the various tenant actions, 810’s contribution claims should be reinstated on a finding of gross negligence; the contribution claims of the remaining codefendants against Holmes were correctly dismissed.

Accordingly, the Appellate Division order should be modified, without costs, in accordance with this opinion and, as so modified, affirmed. The certified questions should be answered in the negative.

Chief Judge Wachtler and Judges Hancock, Jr., Bellacosa and Yesawich, Jr., concur; Judges Simons and Titone taking no part.

Order modified, etc.

      . In addition to negligence and breach of contract claims, 810 sued Holmes under strict tort liability and breach of warranty theories. These too were dismissed. We affirm the dismissal of these claims as 810 failed to make a sufficient showing in support of these claims.

      . In Melodee Lane (18 NY2d, at 68-70, supra), the Court held that the predecessor to General Obligations Law § 5-323 was applicable to a sprinkler alarm contract. That statute declares that exculpatory clauses for ordinary negligence in contracts for work or services "rendered in connection with the construction, maintenance and repair of real property or its appurtenances, shall be deemed to be void as against public policy and wholly unenforceable.” The Court, however, held that limitations of liability are valid notwithstanding this statute if the customer is given an option to purchase protection for full liability. We need not decide whether the statute is applicable here because the Holmes/810 contract provides the option (compare, Florence v Merchants Cent. Alarm Co., 51 NY2d 793, 795 [burglar alarm limitation of liability valid, though no option provided, because contract not within the statute]).

      . Holmes urges that, with the advent of comparative negligence in 1974, the need for distinctions between "gross” and "ordinary” negligence has disappeared, and no reason remains for applying such a distinction to the parties’ contract. Whatever may be the case in other contexts, public policy precludes enforcement of contract clauses exonerating a party from its reckless indifference to the rights of others, whether or not termed "gross negligence.” (See, Kalisch-Jarcho, Inc. v City of New York, 58 NY2d 377, supra; Gross v Sweet, 49 NY2d 102, supra.)

      . See, by contrast, Gutter Furs v Jewelers Protection Servs. (79 NY2d 1027 [decided today]). There, a subscriber charged a burglar alarm company with inadequate and ineffective service, owing to improper design of the system and failure to conduct a post-installation inspection. Despite assertions of "gross” deviation from professional standards, the subscriber’s allegations of misconduct were no more than ordinary negligence. The evidence cannot reasonably be viewed as indicating the reckless indifference that vitiates a contractual exculpatory clause.

      . On this appeal, certain parties that have settled the claims against them also seek contribution. Their claims for contribution are barred by statute (General Obligations Law § 15-108 [c]; see also, Glaser v Fortunoff of Westbury Corp., 71 NY2d 643).

      . In 1986, the Legislature enacted CPLR article 16, which provides that a tortfeasor whose culpability is apportioned at 50% or less is liable only for its proportionate share of noneconomic loss (e.g., pain and suffering, mental anguish) (CPLR 1600,1601 [1]). However, this modification of the traditional joint-and-several liability rule is applicable only in personal injury actions (CPLR 1601 [1]).

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