Contractor’s contractual indemnification obligation to project’s architect/engineer. Valdez v. Turner Construction Co. Appellate Division of the Supreme Court of New York (2019), by Hugh Anderson

Summary: The Dormitory Authority of the State of New York retained Skidmore Owings and Merrill (SOM) as architect and construction manager. SOM subcontracted the construction management to Turner Construction Company. The owner separately contracted with KJC Waterproofing for roofing work. During construction, a landscape contractor’s employee was injured when he became entangled in the straps around a 2500-pound bag of soil that was being lifted with a crane. Although the reported facts of the case are vague, it appears that KJC was either operating the crane or had some other direct connection to the incident. The workman sued SOM, Turner, and KJC, among others. SOM demanded that KJC indemnify SOM with respect to the injury claim.

The contract between the project owner and KJC required KJC to indemnify “the owner’s representative” and the construction manager, provided that the party being indemnified was not itself negligent. The Supreme Court of New York determined that SOM was free from negligence, but declined to require KJC to indemnify SOM. This issue was one of several examined by the Appellate Division of the Supreme Court. [Note: In New York, the “Supreme Courts” are lower-tier courts, which are linked to an intermediate appellate branch. The highest court in the state of New York (equivalent to the supreme courts of other states) is the New York Court of Appeals.]

Decision: The Appellate Division concluded that SOM qualified as “the owner’s representative” and therefore was entitled to indemnification by KJC. Although SOM had subcontracted its construction management duties to Turner, and thus arguably was not the “construction manager” for purposes of the indemnification clause, according to the Appellate Division SOM had retained responsibility for “overseeing contractors’ compliance with the design drawings and specifications and quality control” on behalf of the owner. From this the appellate court concluded that SOM—fundamentally, the architect—should be regarded as the owner’s representative.

Comment: EJCDC engineering agreements and construction contracts expressly establish that Engineer is the “Owner’s representative” during construction. The standard EJCDC indemnification clauses also directly name Engineer as one of the parties to be indemnified by the Contractor.