Fireman's Fund Insurance Company et al v. Wilner et al
ORDER denying 39 Motion for Summary Judgment. The Court finds that a geniune issue of material fact remains as to whether an inteverning act relieved the defendants of liability in this action. Ordered by Chief Judge Carol Bagley Amon on 2/27/2012. (Turner-Dodge, Lee)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
FIREMAN’S FUND INSURANCE CO.,
as subrogee of Sarug Inc., OFNA Corp.,
NOT FOR PUBLICATION
MEMORANDUM & ORDER
10-CV-597 (CBA) (JMA)
-againstJOSEPH WILNER et al.,
AMON, Chief United States District Judge:
The plaintiff—an insurance company suing as subrogee of an insured commercial
tenant—seeks damages suffered as the result of a fire at a commercial building in Ridgewood,
Queens. Certain defendants, the owners and management company of the building, have moved
for summary judgment. For the following reasons, the motion for summary judgment is denied.
The defendants remaining in this case are Joseph Wilner, Rywa Wilner, H. Wilner Realty
Management, LLC (“H. Wilner Realty”) (collectively, the “Wilner defendants”), and Miceli
Kleinhans Roofing Co. (“MK Roofing”).
The Wilner defendants—who now move for summary judgment—do or did own and
manage the commercial property at issue in this case, located 16-16 Summerfield Street in
Ridgewood, Queens (“the Summerfield property”). Joseph Wilner, now deceased, originally
owned the property. When he died, it passed to his wife, Rywa. (Phelan Dec. Ex. 2 at 10.) At
the time of the fire, Rywa was leasing the property to Sarug, the commercial tenant who in turn
purchased insurance from the plaintiff in this case, Fireman’s Fund Insurance Co. (Def. R. 56.1
At the time of the fire, H. Wilner Realty was the management company responsible for
the Summerfield property. (Id. ¶ 1.) Harry Wilner, Rywa Wilner’s son, was the sole member of
H. Wilner Realty; he died in November 2009. H. Wilner Realty also employed Sol Michael
Wilner, Harry’s brother, who is not a party to this case. (Id. ¶ 5.) After Harry died, Michael
started his own company and continued to manage certain properties for Rywa. (Phelan Dec. Ex.
1 at 12–14.)
Before Harry died, H. Wilner Realty employed defendant MK Roofing to perform work
on properties that it managed, including the Summerfield property. (Def. R. 56.1 ¶ 7.) MK
Roofing hired Patrick Kelly, who worked for many years on buildings managed by H. Wilner
Realty. At some point in time before March 16, 2009, Patrick Kelly purchased MK Roofing.
(Id. ¶ 13.)
The parties do not dispute that on March 16, 2009, Kelly—on behalf of MK Roofing—
performed roofing repairs on the Summerfield property at the request of Harry Wilner.
(Id. ¶ 14.) In violation of New York Penal Law, Kelly used a blowtorch to install rubber roofing
material on the wooden frame of the Summerfield property’s roof. (Id. ¶ 15.) While using the
blowtorch to perform repairs, Kelly set fire to the roof of the Summerfield property. (Id.) The
subsequent fire caused substantial damage to the property and to Sarug, the tenant. (Id. ¶ 16.)
On the day of the fire, Kelly spoke on site with a fire investigator. Kelly told the
investigator that the fire was his fault. (Gordon Dec. Ex. I at 62.) Kelly was subsequently
arrested and issued a desk appearance ticket. (Id. at 65.) According to his deposition testimony
in this case, he later paid a fine of approximately two hundred dollars. (Id. at 66.)
In February 2010, Fireman’s Fund filed this action, invoking the district court’s diversity
jurisdiction under 28 U.S.C. § 1332, to recover money it paid Sarug, its insured, for damages
sustained as result of the fire at the Summerfield property. The complaint asserts four claims: (1)
negligence against the Wilner defendants, alleging that they failed to prevent the fire and
consequent damage in various ways; (2) breach of contract/warranty against the property owners,
Joseph and Rywa Wilner, alleging that they breached an obligation to ensure that the
Summerfield property would be protected from fire damage; (3) negligence against MK Roofing,
alleging that the company negligently performed the roof repair work that resulted in the fire;
and (4) negligence against Clearview Roofing, which has since been dismissed from this action.
MK Roofing answered the complaint on April 22, 2010, and asserted a cross claim for
negligence against the Wilner defendants. The Wilner defendants now move for summary
judgment on (1) the plaintiff’s negligence and breach of contract/warranty claims; and (2) MK
Roofing’s cross-claim for negligence.
Summary Judgment Standard
Summary judgment is appropriate where the record “show[s] that there is no genuine
issue as to any material fact and that the moving party is entitled to judgment as a matter of law.”
Fed. R. Civ. P. 56(c). An issue of fact is genuine if “the evidence is such that a reasonable jury
could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248 (1986). A fact is material when it “might affect the outcome of the suit under the governing
law.” Jeffreys v. City of New York, 426 F.3d 549, 553 (2d Cir. 2005) (internal quotation marks
The movant bears the burden of establishing that no genuine issue of material fact exists.
Vermont Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 244 (2d Cir. 2004). The court
“must resolve all ambiguities and draw all reasonable inferences against the movant.” Pucino v.
Verizon Wireless Commc’ns, Inc., 618 F.3d 112, 117 (2d Cir. 2010). However, “[t]o survive
summary judgment the nonmoving party must come forward with specific facts showing that
there is a genuine issue for trial.” Niagara Mohawk Power Corp. v. Jones Chem. Inc., 315 F.3d
171, 175 (2d Cir. 2003) (internal quotation marks and emphasis omitted).
The Parties’ Arguments
The Wilner defendants move for summary judgment on one ground only: that Kelly’s
criminal use of the blowtorch on the Summerfield property was an intervening act that relieves
them of any liability for the damage caused. (Def. Mem. at 4–6.)
The plaintiffs and MK Roofing respond that Kelly’s use of the blowtorch was not
independent of the Wilner defendants’ conduct, nor was it unforeseeable, because the evidence
shows that Harry Wilner (as agent for Rywa Wilner and H. Wilner Realty) directed Kelly to use
the blowtorch on the Summerfield property. Kelly testified during his December 2, 2010
deposition, apparently for the first time, that he used the blowtorch on the Summerfield roof at
Harry’s direction. Kelly testified that Harry “only wanted torch roofing” on the H. Wilner
Realty properties. (Gordon Dec. Ex. I at 31.) Kelly testified that he tried to convince Harry to
use another system but “he insisted on having torch.” (Id. at 32.) Kelly said he “explained to
Harry that it was illegal to do it on the premises of his property” but that Harry “insisted he
wanted it.” (Id. at 34.) Kelly testified that he explained to Harry that the Summerfield property
had a wood frame roof, but that Harry insisted he proceed with the blowtorch. (Id. at 35.)
Michael Wilner, on the other hand, testified at his deposition that Harry, who is now
deceased, was not in the business of instructing roofers—or any other subcontractors who are
professionals in their particular field—about the manner in which they should perform their
work. (Phelan Dec. Ex. 1 at 37–38.) Michael conceded that he was never personally involved in
the hiring or instruction of repairmen, and that he had no knowledge of the content of any
conversations between Harry and Kelly, but he insisted that his brother was not the sort of man
to insist on a certain type of roofing application. (Id. at 38–39, 44–46.)
The Wilner defendants do not dispute that if the Court finds admissible Kelly’s testimony
that Harry directed him to use the blowtorch, their motion for summary judgment must fail.
They contend, however, that Kelly’s testimony is not admissible against them for two reasons:
(1) because it contains hearsay; and (2) because it is barred by New York’s Dead Man’s Statute,
N.Y. C.P.L.R. § 4519. They argue that without Kelly’s testimony they are entitled to summary
judgment as a matter of law because the superseding event, not any conduct by the Wilner
defendants, was the proximate cause of the plaintiff’s loss.
The plaintiff and MK Roofing, on the other hand, argue that neither the hearsay rules nor
§ 4519 prevents consideration of Kelly’s testimony. The plaintiff and MK Roofing have not
offered any theory on which they could prevail if the Court does not consider Kelly’s testimony,
and thus this motion for summary judgment turns entirely on whether the Court can consider
Kelly’s deposition testimony.
The Wilner defendants argue that Kelly’s testimony about his conversation with Harry
contains hearsay and is therefore not admissible under Federal Rule of Evidence 802.
As an initial matter, the Court observes that there are two aspects of Kelly’s testimony
that are relevant to the Wilner defendants’ argument that Kelly’s criminal use of a blowtorch
constituted a “superseding event” that they could not have foreseen. First, there is Kelly’s
testimony about what he said to Harry during their conversation about the work to be performed
on the Summerfield property. That testimony would show that Harry was on notice of the fact
that Kelly would be using a blowtorch on a wooden roof, which would refute the Wilner
defendants’ argument that they could not have foreseen Kelly’s illegal, fire-causing conduct.
The second aspect of Kelly’s testimony, which is the aspect on which the parties have focused,
are the statements that Harry expressly directed Kelly to use a blowtorch on the Summerfield
property. That testimony refutes both the argument that Kelly’s conduct was unforeseeable and
also the argument that his conduct was independent of that of the Wilner defendants.
The Wilner defendants’ hearsay argument is rejected as to Kelly’s testimony that he
informed Harry he would be using a blowtorch on the wooden roof. That testimony is not
hearsay because it is not offered for the truth of any of Kelly’s prior statements. That testimony
is offered only for the effect that those prior statements had on Harry—that they gave him
knowledge of the fact that Kelly would use a blowtorch on the roof of the Summerfield property.
United States v. Ferguson, -- F.3d --, 2011 WL 6351862, at *17 (2d Cir. 2011) (holding that a
statement is not hearsay when “it was offered solely for the purpose of showing that the
statement was made”); George v. Celotex Corp., 914 F.2d 26, 30 (2d Cir. 1990) (“To be sure, an
out of court statement offered not for the truth of the matter asserted, but only to show that the
defendant was on notice of a danger, is not hearsay.”).
The Wilner defendants’ hearsay argument is also rejected as to Kelly’s testimony about
what Harry said to him. Hearsay is evidence of a declarant’s out-of-court statement offered to
prove the truth of what is asserted in the statement. See Fed.R.Evid. 801(a). Kelly’s testimony
that Harry insisted that he “use the blowtorch” is an imperative—a command that Kelly do
something. The statement does not assert any fact, which means that it simply is not hearsay.
United States v. Ned, 637 F.3d 562, 569 (5th Cir. 2011) (testimony that defendant “[told me to]
go to the front door” is not an assertion of fact, but rather non-assertive oral conduct that is not
hearsay); United States v. Waters, 627 F.3d 345, 358 (9th Cir. 2010) (defendant-declarant’s
admonition to a friend to “tell the truth” to investigators is not hearsay because it is “an
imperative and not an assertion of fact”); United States v. Hayes, 369 F.3d 564, 568 (D.C. Cir.
2004) (“The imperative ‘tell the truth’ does not expressly assert anything.”).
In sum, Harry’s testimony that (a) he informed Harry that he would use a blowtorch; and
(b) Harry instructed him to use a blowtorch does not contain hearsay and is admissible unless
barred by some other legal rule.
New York’s Dead Man’s Statute
The Wilner defendants also assert that the Court is barred from considering Kelly’s
deposition testimony by New York’s Dead Man’s Statute, N.Y. C.P.L.R. § 4519. 1 The statute
provides, in relevant part:
This statute applies in federal court in diversity suits governed by New York law. Rosenfeld v. Basquiat, 78 F.3d
84, 88 (2d Cir. 1996), citing Fed.R.Evid. 601 (“in civil actions and proceedings, with respect to an element of a
claim or defense to which State law supplies the rule of decision, the competency of a witness shall be determined in
accordance with State law”); Brand v. Brand, 811 F.2d 74, 79 (2d Cir. 1987) (“Under Fed. R. Evid. 601, New
York’s Dead Man’s Statute applied to this diversity action.”).
Upon the trial of an action . . . , a party or a person interested in the event . . . shall
not be examined as a witness in his own behalf or interest . . . against the
executor, administrator or survivor of a deceased person . . . or a person deriving
his title or interest from, through or under a deceased person . . . , concerning a
personal transaction or communication between the witness and the deceased
person . . . , except where the executor, administrator, [or] survivor . . . is
examined in his own behalf, or the testimony of the . . . deceased person is given
in evidence, concerning the same transaction or communication.
N.Y. C.P.L.R. § 4519. “The party seeking the protection of The Dead Man’s Statute bears the
burden of demonstrating that the witness’ testimony is subject to the statutory exclusion.”
Tenuto v. Lederle Labs., 896 N.Y.S.2d 618, 621 (N.Y. Sup. Ct. 2010) (citing Stay v. Horvath,
576 N.Y.S.2d 908 (N.Y. App. Div. 1991)).
The Dead Man’s Statute “prevent[s] the living from testifying to certain ‘personal
transactions’ with the dead.” Matter of Wood, 52 N.Y.2d 139, 144 (N.Y. 1981). “One of the
main purposes of the rule [i]s to protect the estate of the deceased from claims of the living who,
through their own perjury, could make factual assertions which the decedent could not refute in
court.” In re Zalk, 10 N.Y.3d 669, 678 (N.Y. 2008) (quoting Matter of Wood, 52 N.Y. 2d at
143-44); see also Ward v. Kovacs, 390 N.Y.S.2d 931, 403 (N.Y. App. Div. 1977) (holding that
application of the statute “must be grounded, ultimately, on the concept that where death has
sealed the lips of one of the parties to a personal transaction, the law, for the protection of his
estate and his survivors, should and ought to seal the lips of anyone else making a claim against
the estate”). Under the statute, an interested witness cannot testify against a decedent’s estate
about a personal transaction with the decedent. Rosenfeld v. Basquiat, 78 F.3d 84, 88 (2d Cir.
No party suggests that Kelly, whose testimony is at issue, is not “a person interested in
the event” of this litigation within the meaning of the Dead Man’s Statute. Kelly is the principal
of MK Roofing, a defendant in this case, who has an interest in ensuring that liability is spread
among the defendants. Nor is there any dispute that his testimony involves a personal
transaction with the decedent, Harry. The question in this case is whether Joseph Wilner (the
deceased’s father), Rywa Wilner (the deceased’s mother), and/or H. Wilner Realty (the company
formerly owned by the deceased), against whom the testimony is offered, can invoke the
protection of the Dead Man’s Statute to bar the Court from considering Kelly’s deposition
testimony in resolving this motion for summary judgment.
Because the purpose of the Dead Man’s Statute is to protect the estate of the decedent,
whether it can be invoked to exclude otherwise admissible testimony depends on who the
testimony is offered against. The plain language of the statute requires that the testimony be
offered “against the executor, administrator or survivor of a deceased person . . . or a person
deriving his title or interest from, through or under a deceased person.” N.Y. C.P.L.R. § 4519.
Relying on this language, the New York Court of Appeals held in its most recent discussion of
the statute that it did not apply in an attorney disciplinary proceeding to preclude an attorney
from testifying to a conversation he had with his deceased client about how to handle a large
down payment in a real estate transaction. In re Zalk, 10 N.Y.3d at 678. The statute did not bar
the attorney’s testimony because he “did not testify ‘against the executor, administrator or
survivor’ of [the decedent],” as required by the language of the statute, but “[r]ather, he testified
against the Disciplinary Committee.” Id. at 679.
Similarly, both district courts and New York state courts have found that the statute does
not bar an interested witness from testifying to personal interactions with a decedent if a
judgment against the person or company against whom the testimony is offered would not affect
the estate or survivor of the decedent, or a person deriving his title in interest from the decedent.
See e.g., Courtland v. Walston & Co., 340 F. Supp. 1076, 1085-86 (S.D.N.Y. 1972) (holding that
statute did not bar testimony offered against a corporation for whom the decedent was an agent
because the testimony would not “affect any right or property derived ‘from, through or under’
the deceased agent, as the principal of the agent was neither a survivor nor a person deriving his
title or interest from, through or under the decedent within the meaning of the statute.”); Home
Ins. Co. v. Aurigemma, 257 N.Y.S.2d 980, 987 (N.Y. Sup. Ct. 1965) (holding that statute did not
bar defendant’s testimony because “his testimony would not be against the interest of the
representative or survivor of [the decedent] and therefore not within the purview of the statute”);
Rodenhouse v. American Cas. Co. of Penn., 244 N.Y.S.2d 856, 857 (N.Y. App. Div. 1963)
(holding that in suit against corporation, Dead Man’s Statute did not bar plaintiff’s testimony
about communications with corporation’s agent, deceased at time of litigation, because
corporation who testimony was offered against “was neither survivor nor a person deriving his
title or interest from a decedent”).
Based on these cases, the Court finds that neither Joseph nor Rywa Wilner can invoke the
Dead Man’s Statute to exclude Kelly’s testimony. Neither party is the executor or administrator
of Harry’s estate. Nor is there any evidence on the record to suggest that a judgment against
either Joseph or Rywa Wilner could adversely affect Harry’s estate, or any person or entity that
derived an interest in this lawsuit from Harry. Joseph and Rywa Wilner argue that they are
“survivors” of Harry because they are his parents. However, they are not being sued in this
action in their capacity as Harry’s next of kin. Rather, they are being sued in their individual
capacity, as owners or previous owners of the Summerfield property. See Ehrlich v. Am.
Moninger Greenhouse Mfg. Corp., 26 N.Y.2d 255, 256 (N.Y. 1970) (holding that plaintiff, wife
of decedent, could not invoke Dead Man’s Statute to exclude defendant’s testimony because
“plaintiff has brought this action in her individual capacity, and not as a representative of an
estate or a survivor of a decedent”); Levine v. Levine, 590 N.Y.S.2d 439, 445 (N.Y. App. Div.
1992) (holding that plaintiffs, wife and children of decedent, could not invoke statute to exclude
defendant’s testimony because although “such testimony would be against the interest of [the
decedent’s] children, it would not be against the interest of his estate”). Although Kelly’s
testimony might be against the interest of Harry’s parents, it is not being offered against the
interest of his estate.
It is less clear on this record whether a judgment against H. Wilner Realty—which was
owned by Harry—would adversely affect Harry’s estate or some interest of Harry’s to which
some individual or entity has succeeded. Harry was not a mere agent of the H. Wilner Realty, he
was the sole member of the limited liability corporation. See Mark Patterson, Inc. v. Bowie, 661
N.Y.S 2d 709, 711-12 (N.Y. Sup. Ct. 1997) (holding that Dead Man’s Statute applied to bar
testimony offered against defendant corporation where decedent had ownership interest in
corporation, thereby giving the executors of the decedent’s estate a pecuniary interest in any
judgment against the corporation).
Michael Wilner testified at his deposition that “H. Wilner Realty no longer exists.”
(Phelan Dec. Ex. 1 at 12.) He explained that everything at H. Wilner Realty was under Harry’s
name and that he “cannot find any paperwork.” (Id. at 13.) At oral argument, counsel for the
Wilner defendants represented that the Wilner defendants do not know the details of Harry’s
estate, who is the executor, or if anyone benefitted from the estate. If a judgment against H.
Wilner Realty could adversely affect Harry’s estate or some interest of Harry’s to which some
individual or entity has succeeded, then H. Wilner Realty could invoke the protections of § 4519.
However, on this record, the Court finds that H. Wilner Realty has not met its burden of
demonstrating that a judgment against the dissolved company would have such an effect, and
therefore it has not met its burden of demonstrating that it can invoke the statute to exclude
Kelly’s deposition testimony. 2 The Court therefore can consider Kelly’s deposition testimony in
determining whether to grant summary judgment in favor of the Wilner defendants.
Taking into account Kelly’s deposition testimony, a genuine issue of material fact
remains as to whether Kelly’s use of the blowtorch on the Summerfield property constituted an
intervening act that relieved the Wilner defendants of liability, or whether it foreseeable. See
Stagl v. Delta Airlines, Inc., 52 F.3d 463, 473 (2d Cir. 1995) (“The governing rule in New York
has long been settled and is perfectly clear: an intervenor’s actions will not break the necessary
chain of causation where they are a normal or foreseeable consequence of the situation created
by the defendant’s negligence.”) (quotation marks omitted). Accordingly, the Wilner
defendants’ motion for summary judgment is denied.
Dated: Brooklyn, New York
February 27, 2012
Carol Bagley Amon
United States District Judge
Because the Court finds that on this record none of the Wilner defendants can invoke the Dead Man’s Statute to
exclude Kelly’s testimony, the Court need not address the plaintiff’s argument that the Dead Man’s Statute, if
applicable, cannot be invoked at the summary judgment stage.
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