The Exceptions to Circumvent the alleged “Independent Contractor” Defense

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In subrogation actions arising from a subcontractor’s negligence, a common defense for a general contractor is to allege that the subcontractor was an “independent contractor.” In other words – “it wasn’t me, it was the other guy, and I’m not responsible for him!” But is that always the end of the story?

Courts in New York, and many other courts around the country, confirm that the answer is “no”. Simply claiming that the individual who caused the damage is an independent contractor is not a “get out of jail” free card. Liability can still attach to a General Contractor, or even a property owner, in a number of ways, which can be supported by factual details solicited through deposition testimony.

Generally speaking, a party who retains an independent contractor, as distinguished from a mere employee, is not liable for that independent contractor’s negligent acts. Bros. v. New York State Elec. & Gas Corp., 11 N.Y.3d 251, 257 (N.Y. 2008).  This rule, however, has become subject to so many exceptions that Courts have now taken to saying that the general rule “is primarily important as a preamble to the catalog of its exceptions”. Id.

The exceptions include: negligence in selecting, instructing, or supervising the contractor; non-delegable duties of the employer, arising out of some relation toward the public or the particular plaintiff; and work which is specially, peculiarly, or inherently dangerous.

One key factor to evaluating liability is to determine whether the general contractor had control over the subcontractor. Specifically, whether there is “control of the method and means by which work is to be performed.” Courts have identified this as a “critical factor in determining whether a party is an independent contractor or an employee for the purposes of tort liability.”  Goodwin v. Comcast Corp., 42 A.D.3d 322, 840 N.Y.S.2d 781 (2007).

Factors that might indicate control can include, for example, the timing and payment of the work.  To wit, did the general contractor dictate the timing or order of the construction? Did the general contractor control the communications between the subcontractor and the ultimate owner of the property? Did the general contractor facilitate the payment of the subcontractor? Did the general contractor provide access to the property for the subcontractor? Did the general contractor provide materials? Were the invoices for the subcontractor paid for by the general contractor? Did the general contractor monitor or inspect the work after completion?  These are just some of the ways in which the critical question of control can be explored.

Another common circumstance is when a defendant hires another party to do the work it actually contracted to perform.  In a recent case, Allstate Insurance Company a/s/o Malek v.  Edelweiss of NYC, Inc., et al, the Court upheld a finding of liability against a defendant even though the parties stipulated that the individual who caused the damage was acting as an independent contractor at the time of the incident. Although this was an automobile case, the theory of liability is easily transferrable to property subrogation actions. The Court noted, “a defendant who employs an independent contractor to perform services that the defendant has undertaken to perform, is liable for the negligence of the independent contractor (Miles v. R & M Appliance Sales, 26 NY2d 451).”  In other words, if a defendant engages a subcontractor after it is hired to perform a task, it is still responsible for that task. The buck stops with them.

In sum, pointed discovery and depositions on the above factor of control can substantiate a record to circumvent the alleged “Independent Contractor” defense.

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