Torts, Insurance and Compensation Law Weblog

The New York Court of Appeals recently granted leave to appeal in City of New York v. Welsbach Elec. Corp., which concerns issues surrounding the doctrine of res judicata.  Welsbach contracted in 1991 with the City of New York to maintain certain traffic lights in Queens County.

A lawsuit between two drivers was commenced in 1994, which included Welsbach and the City as the defendants, alleging malfunction of the traffic control signal. Welsbach moved for summary judgment in 1997 on two grounds (that it owed no duty to the public in the performance of its maintenance contract with the City, and that it timely and completely performed its contractual obligations to the City). The motion, which was supported by a detailed and unrebutted affidavit of a traffic signal maintenance mechanic employed by Welsbach, was granted on both grounds, a final judgment of dismissal was entered and the City did not appeal. In 2000, the remaining claims were tried and the City was found negligent and responsible for substantial personal injuries sustained by individuals involved in the accident. The jury specifically found that each motorist had a green traffic signal and that neither was negligent.

Subsequently the City appealed, named Welsbach a respondent, and sought review of the 1997 grant of summary judgment to Welsbach.  In response to a motion by Welsbach, the City executed a stipulation withdrawing its attempted and belated appeal of the 1997 Welsbach judgment of dismissal. This action that was thereafter commenced in 2003.  The Appellate Division, First Department held that the City's action for common-law and contractual indemnification was barred by the doctrine of res judicata because Welbach's unrebutted 1997 summary judgment addressed all claims arising out of the underlying accident.

We will keep you apprised of this appeal.