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Baboghlian v. Swift Electrical Supply Co.

February 18, 2009

ELIZABETH BABOGHLIAN, INDIVIDUALLY AND AS EXECUTRIX OF THE ESTATE OF VARTKES O. BABOGHLIAN, VARTKES BABOGHLIAN SHELTER TRUST, VIGEN BABOGHLIAN, VARTKES K. BABOGHLIAN, ESTATE OF RAHILE BABOGHLIAN AND ARTISTIC FURNITURE & LIGHTING CO., INC. AND/OR VARTKES O. BABOGHLIAN AND ELIZABETH BABOGHLIAN T/A ARTISTIC FURNITURE & LIGHTING COMPANY, PLAINTIFFS-RESPONDENTS,
v.
SWIFT ELECTRICAL SUPPLY CO., A CORPORATION, A/K/A SWIFT ELECTRICAL SUPPLY CO., INC., SWIFT ELECTRIC SUPPLY CO., A CORPORATION, SWIFT ELECTRIC SUPPLY CO., AS SUCCESSOR-IN-INTEREST TO SWIFT ELECTRIC SUPPLY CO., AUGUST SODORA, IMPROPERLY PLEAD AS AUGUST SADORA, INDIVIDUALLY AND T/A SWIFT ELECTRICAL SUPPLY CO. AND/OR SWIFT ELECTRIC SUPPLY CO. AND AUGUST SODORA, JR., IMPROPERLY PLEAD AS AUGUST SADORA, JR., INDIVIDUALLY AND T/A SWIFT ELECTRICAL SUPPLY CO. AND/OR SWIFT ELECTRIC SUPPLY CO., DEFENDANTS-APPELLANTS, AND ABC CORPORATIONS 1-5 AND JOHN DOES 1-5, DEFENDANTS.



On certification to the Superior Court, Appellate Division, whose opinion is reported at 393 N.J. Super. 187 (2007).

SYLLABUS BY THE COURT

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

WALLACE, JR., J., writing for a unanimous Court.

In this appeal, the issue is whether the owner of a building, who voluntarily installs a fire alarm system, owes a non-delegable duty to comply with certain provisions of the Uniform Fire Code, N.J.A.C. 5:70-1.1 to -4.20.

Plaintiffs owned a building where they resided and operated a business. Defendants owned and operated a business in a building they owned adjacent to plaintiffs' building. In 1987, defendants renovated their building. They hired JMG Electrical Contractors to install a fire alarm system, which included smoke and heat detectors and a fire alarm panel with a telephone line connected to a central station. JMG serviced the fire alarm system upon request. The last recorded service occurred on March 19, 1993. In August 1995, a fire started in defendants' building and spread to plaintiffs' building. Both structures were badly damaged and had to be demolished. Plaintiffs filed suit, alleging that defendants negligently maintained their premises and failed to comply with fire safety measures. Defendants in turn filed suit against JMG.

Plaintiffs' expert, James Valentine, testified that defendants' fire alarm system failed on the evening of the fire. He explained that a smoldering fire like the one that originated in defendants' building could have been contained because a properly installed system is designed to detect fires in a small growth stage, in order to give the fire company a chance to extinguish the fire before it spreads. Valentine could not conclude to a reasonable degree of scientific probability whether the system failure resulted from improper coverage and/or location of fire detectors or a malfunctioning system component. He noted that it was reasonable for defendants to rely on JMG to properly design the fire alarm system and to inform defendants of maintenance and code requirements for the system. He explained that once defendants decided to install the system, they should have obtained a permit, had a sub-code official test the system after it was installed, and had it inspected each year. Valentine conceded that the Uniform Fire Code (Code) did not require installation of a fire alarm system in defendants' building at any time prior to the fire.

Defendants' expert, Jeffrey Zwirn, testified that it was reasonable for defendants to rely on JMG to advise them of any Code standards or other requirements relating to installation of the system. He explained that the Code did not require defendants to install a fire alarm system. He also found that the system was appropriately designed, and that a properly working system would not have activated at the initial stage of the fire due to the location of the fire's origin. Finally, Zwirn asserted that defendants' failure to obtain permits or have inspections did not cause the fire or contribute to its spread to plaintiffs' building. JMG offered testimony that it applied for and received proper permits, but it no longer had copies of those records.

Prior to the trial court's charge to the jury, plaintiffs asked that the court charge the jury that defendants had a non-delegable duty to comply with the Code. The court denied that request and charged the jury according to general principles of negligence and proximate cause. The charge included an instruction that if the jury found that defendants did not comply with the Code, the jury could consider that as evidence of negligence. The court further instructed the jury that if it found that defendants were negligent, the jury must find that their negligence was a proximate cause of the accident before the jury could find defendants responsible for the plaintiffs' claimed damages. Also, in response to one of the questions asked by the jury during deliberations, the court answered, "in order to hold JMG negligent, Swift Electric must be found to be negligent, at least in part."

The jury found that both JMG and defendants were negligent, but that their negligence was not a proximate cause of plaintiffs' damages. Plaintiffs moved for judgment notwithstanding the verdict or a new trial. The court denied the motion. Plaintiffs appealed, arguing in part that the court failed to properly instruct the jury that defendants owed a non-delegable duty.

The Appellate Division reversed and remanded for a new trial. Baboghlian v. Swift Elec. Supply, 393 N.J. Super. 187 (2007). The panel concluded that the specific duties imposed on a property owner under the Code are non-delegable because they direct action in an area designed to protect public safety. The panel concluded that a properly instructed jury could find that failure to obtain the necessary permits and initial inspection of the fire alarm system could be evidence of defendants' breach of its non-delegable duty to assure its system was properly operating.

The Supreme Court granted defendants' petition for certification. 194 N.J. 445 (2008).

HELD: Under the circumstances presented, in the absence of a statutory requirement to install a fire alarm system, the former Code requirements to obtain a permit and perform inspections do not justify the imposition of a non-delegable duty on a property owner in the installation of a fire alarm system.

1. The Legislature passed the Uniform Fire and Safety Act to ensure that all areas of the State are protected by a uniform fire safety code to protect the lives and property of the State's citizens. The Code, promulgated pursuant to the Act, provides that a property owner "shall be responsible for the safe and proper maintenance of the premises at all times." At the time of the fire, the Code did not require defendants to have a fire alarm system in their building. However, if a building owner installed a fire alarm system, the owner was required to obtain a permit and thereafter perform annual testing. (pp. 11-13)

2. The Court will not impose a non-delegable duty to obtain a permit and inspect a fire alarm system when there was no obligation to install the system in the first place. As a general rule, one who engages an independent contractor is not liable for the negligence of that contractor in the performance of the contract. As the Appellate Division recognized, the exceptions identified by the Court in other cases do not apply to the present case. (pp. 13-14)

3. The Appellate Division, however, looked to its decision in Great Northern Ins. Co. v. Leontarakis, 387 N.J. Super. 583 (App. Div. 2006), to consider an additional exception where the contractor's activity presents a significant risk of grave harm. In Great Northern, excavation work caused the collapse of supporting soil and extensive damage to a neighbor's brick wall and home. A relevant statute required a party performing excavation to preserve, at his own expense, neighboring property from injury. The court held that the property owner owed a non-delegable duty to his neighbor for lateral support because the Legislature recognized the significant risk of grave harm involved in removing lateral support from adjoining land. Our courts have imposed non-delegable duties in other instances in which the potential for grave harm was involved. (pp. 14-16)

4. Although the Code is designed to protect the lives and property of the State's citizens, this case does not present the necessary conditions to impose a non-delegable duty on property owners in the installation of a fire alarm system. Unlike in Great Northern, in which the Appellate Division relied on a statutory requirement to find a non-delegable duty, neither a statute nor the Code required that defendants install a fire alarm system. Indeed, when later recodified, the Code did not include the permit and inspection obligations that plaintiffs allege defendants failed to fulfill. Under the circumstances presented, in the absence of a statutory requirement to install a fire alarm system, the Court finds that the former Code requirements to obtain a permit and perform system inspections do not justify the imposition of a non-delegable duty. (p. 17)

5. Plaintiffs also assert that the trial court erred in instructing the jury that in order to find JMG negligent, it must first find defendants negligent. The jury found that both JMG and defendants were negligent, but that their negligence was not the proximate cause of plaintiffs' damages. Thus, even if the trial court was mistaken, the jury's finding of no proximate cause rendered any error harmless. (pp. 18-19)

The judgment of the Appellate Division is REVERSED and the verdict of the jury is REINSTATED.

The opinion of the court was delivered by: Justice Wallace, Jr.

Argued October 20, 2008

CHIEF JUSTICE RABNER and JUSTICES LONG, LaVECCHIA, ALBIN, RIVERA-SOTO, and HOENS join in ...


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