Mohawk Valley Health System, Plaintiff/Counterclaim Defendant, v. BRIEN GERE ENGINEERS INC (2026)

On January 24, 2025, Plaintiff Mohawk Valley Health System (Plaintiff or MVHS) commenced this action alleging causes of action for negligence and professional malpractice, and breach of contract related to Defendant Ramboll Americas Engineering Solutions Inc. f/k/a/ O'Brien & Gere Engineers, Inc.'s (Defendant or Ramboll) civil engineering services for Plaintiff's replacement hospital in the City of Utica.

On April 3, 2026, Defendant filed an answer containing three counterclaims: (1) contractual indemnification; (2) common law indemnification; and (3) declaratory judgment. Plaintiff moves to dismiss Defendant's counterclaims under CPLR 3211 (a) (1) and (7) on the basis that there is a complete defense to each. In particular, Plaintiff argues that no contractual provision requires Plaintiff to indemnify Defendant or pay Defendant's attorney fees in litigation between Plaintiff and Defendant; no common law indemnification claim is available where Defendant is alleged to have actively committed professional negligence; and the declaratory judgment counterclaim cannot revive the contractual indemnification claim or create obligations that do not exist under the agreement.

Defendant opposes, arguing that it has a viable contractual indemnification claim because "Losses" within the meaning of the parties' Professional Services Agreement ("Agreement") includes those arising from MVHS's own conduct, including "Losses" from defending against "MVHS's frivolous claims"; its common law indemnification is also properly pleaded because the complaint "leaves open the possibility that any liability imposed on Ramboll would be vicarious or derivative of the conduct of others" and therefore dismissal of that claim would be premature; and that a declaratory judgment is necessary to "resolve the controversy between the parties and guide their conduct during the litigation."

On a motion to dismiss pursuant to CPLR 3211 (a) (7), the Court must "accept the facts as alleged in the [counterclaim] as true, accord [the non-moving party] the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory . . . [T]he criterion is whether [the non-moving party] has a cause of action, not whether [it] has stated one" (Leon v Martinez, 84 NY2d 83, 87-88 [1994]; see Burton v Matteliano, 81 AD3d 1272, 1274 [4th Dept 2011], lv denied 17 NY3d 703 [2011]). Under CPLR 3211 (a) (1), documentary evidence must "resolve[ ] all factual issues as a matter of law, and conclusively dispose[ ]" of the relevant claims (Baumann Realtors, Inc. v First Columbia Century-30, LLC, 113 AD3d 1091, 1092 [4th Dept 2014]). Where a written agreement unambiguously contradicts the allegations supporting a claim, "the contract itself constitutes documentary evidence warranting the dismissal of the complaint pursuant to CPLR 3211 (a) (1)" (150 Broadway NY Assocs., L.P. v Bodner, 14 AD3d 1, 5 [1st Dept 2004]).

Legal Analysis

Contractual Indemnification

Attorney fees are incidents of litigation and a prevailing party may not collect them from the loser unless an award is authorized by agreement between the parties, statute, or court rule (see, Matter of A. G. Ship Maintenance Corp. v Lezak, 69 NY2d 1, 5 [1986]; Mighty Midgets v Centennial Ins. Co., 47 NY2d 12, 21-22 [1979]; City of Buffalo v Clement Co., 28 NY2d 241, 262-263 [1971]). Parties may contract to include a promise by one party to hold the other harmless for a particular loss or damage, and counsel fees are a form of loss or damage which may be indemnified in this way (see, e.g., Breed, Abbott & Morgan v Hulko, 139 AD2d 71 [1st Dept 1988], aff'd 74 NY2d 686 [1989]; Brooklyn Union Gas Co. v Shields Detective Bur., 121 AD2d 587, 590 [2d Dept 1986] appeal denied 69 NY2d 610 [1987]; Rosano's Farm Store v International Collection Serv., 115 AD2d 195, 196 [3d Dept 1985]; Lavorato v Bethlehem Steel Corp., 91 AD2d 1184, 1185 [4th Dept 1983]). However, the Court of Appeals in Hooper Assoc. v AGS Computers (74 NY2d 487 [1989]), noting that "[w]ords in a contract are to be construed to achieve the apparent purpose of the parties," particularly in the indemnification context where a party is under no legal duty to indemnify, and that a contract assuming an obligation to indemnify must be strictly construed to avoid reading into it a duty which the parties did not intend to be assumed, held that:

"[i]nasmuch as a promise by one party to a contract to indemnify the other for attorney fees incurred in litigation between them is contrary to the well-understood rule that parties are responsible for their own attorney fees, the Court of Appeals held that "a court should not infer a party's intention to waive the benefit of the rule unless the intention to do so is unmistakably clear from the language of the promise"

(Hooper, 74 NY2d at 491 [emphasis added], citing Tokyo Tanker Co. v Etra Shipping Corp., 142 AD2d 377, 378 [1st Dept 1989]).

In Hooper, the Court concluded that the language used in the Agreement was not unmistakably clear. The indemnification clause did not contain language clearly permitting the plaintiff to recover from the defendant attorney fees incurred in a suit against the defendant. Instead, it contained language typical where the parties contemplate reimbursement only when the indemnitee is required to pay damages on a third-party claim: defendant must "indemnify and hold harmless [plaintiff] * * * from any and all claims, damages, liabilities, costs and expenses, including reasonable counsel fees arising out of breach of warranty claims, the performance of any service to be performed, the installation, operation and maintenance of the computer system, infringement of patents, copyrights or trademarks and the like" (Hooper, 74 NY2d at 492). The Court held that "All these subjects are susceptible to third-party claims for failures in the installation or operation of the system. None are exclusively or unequivocally referable to claims between the parties themselves or support an inference that defendant promised to indemnify plaintiff for counsel fees in an action on the contract" (id.). Thus, the Court construed the indemnification clause as pertaining to only third-party suits.

The Court noted, however, that a clause could clearly demonstrate an intent to indemnify for damages, including legal fees, incurred in defending in an intra-party action, specifically citing to Breed, Abbott & Morgan v Hulko (139 AD2d 71 [1st Dept 1988] aff'd 74 NY2d 686 [1989]). There, the contract contained an indemnification provision which provided that Breed, Abbott would not be liable to either party to a sale "for any act or omission except for bad faith or gross negligence" and that it would be indemnified and held "harmless from any claims, damages, losses or expenses arising in connection [t]herewith."¹ Abbott prevailed in an action where Hulko sued it claiming release to the sellers of an escrow downpayment was wrongful, and then commenced an action to recover the legal expenses it incurred in defending against Hulko's claim. The Court of Appeals concluded that, in that case, Hulko had agreed in the contract to indemnify the plaintiff for the legal expenses incurred in resisting his claims. The Court of Appeals noted that, in that case, the intent of the parties was manifest: if the promise to indemnify Breed, Abbott did not extend to legal expenses incurred in defending against an action by one of the parties alleging misconduct by the escrowee which resulted in a determination in favor of the escrowee, it was "difficult, if not impossible, to ascertain for what it was the parties had agreed to indemnify the escrowee" (id. at 73).

The Court of Appeals again addressed this same issue in Sage Systems, Inc. v Liss (39 NY3d 27 [2022]), distinguishing the Agreement provisions that arose in that case from both Hooper and Breed, Abbott. There, the Court found the indemnification provisions in a contract  ² to be broader than the indemnity clause in Hooper, but unlike the provision in Breed: although it was broader than the Hooper clause in that it covered intra-party and third-party claims—limited only by the condition that a partner have committed some misconduct—it was not "difficult or impossible" to determine what the provision would cover if not attorney fees. Thus, nothing in the provision nor the agreement as a whole made it "unmistakably clear that the partners intended to permit recovery for attorney's fees in an action between them on the contract" (id. at 33).

Accordingly, for an indemnification provision to apply to intra-party claims, and to apply to attorney fees, the clear intent of the indemnification provision must be to apply to intra-party claims and attorney fees therein.

Here, Defendant relies on the following contractual provision of the Agreement (NYSCEF Doc. No. 9) for its contractual indemnification claim:

"Subject to paragraph 15 of these General Terms & Conditions, Engineer [(Ramboll)] agrees to defend, indemnify and hold harmless Client [(MVHS)], its directors, officers, employees, agents, successors and assigns from Losses to the extent and in the proportion caused by the willful misconduct or negligent acts, errors or omissions of [Ramboll], its directors, officers, employees, and its agents, subcontractors, successors and assigns.

To the extent and in the proportion not caused by the willful misconduct or negligent acts, errors or omissions of [Ramboll], its directors, officers, employees or its agents, subcontractors, successors and assigns, [MVHS] agrees to defend, indemnify and hold said persons harmless from Losses arising in connection with Project" (Paragraph 13 of Agreement)

Paragraph 15, as referenced in the indemnification clause, places the maximum amount of liability of "Engineer" to "Client" at the amount specified in the insurance clause (Paragraph 14).

Paragraph 1(c) of the Agreement describes "Losses," referenced in the indemnification clause, as "monetary damages suffered or costs and expenses incurred, including interest and reasonable attorney's fee, as a result of any demand made, cause of action asserted, judgment or decree entered, or any fine or penalty imposed, or any settlement payment consented to by both parties in connection with this Agreement." Therefore, "Losses" within the meaning of paragraph 15, expressly applies to attorney fees.

Paragraph 13 is a proportional indemnity clause. Generally, contribution distributes loss among tortfeasors, requiring each to pay his or her proportionate share, while indemnity shifts the entire loss from one tortfeasor compelled to pay, onto the shoulders of another to bear it instead (see Rogers v Dorchester Assoc., 32 NY2d 553, 565 n2 [1973] citing Prosser, Law of Torts (4th ed.), pp. 213-214). A proportionate or limited indemnification clause, however, may ensure that losses are distributed among responsible parties. Here, the indemnification clause provides that, where there is a claim or other "Losses" related to the Project, MVHS will indemnify Ramboll to the extent and in the proportion that another party is at fault—i.e., if there is a proportional determination on liability, and a third party is found to be 70% at fault, MVHS will indemnify Ramboll to the extent there is another party at fault—but to the extent that Ramboll is at fault, Ramboll must indemnify MVHS up to its proportion of fault. This meaning is plain from a reading of the relevant provisions of the Agreement. The question that remains is whether, where MVHS is partially at fault, this provision would apply so that MVHS, too, must indemnify Ramboll to the extent it is at fault, and therefore could still be applicable to intra-party disputes. The Court finds that it is applicable to intra-party disputes.

Courts have routinely held that where an indemnification is broad, in the absence of limiting language, both intra-party and third-party claims are covered (see WSA Group, PE-PC v DKI Eng'g & Consulting USA PC, 178 AD3d 1320, 1323-1324 [3d Dept 2019] ["Nothing in the provision's broad language, which requires defendant to indemnify plaintiff 'against any claim, demand or cause of action of every name or nature,' reveals that the parties intended to exclude claims such as this from its coverage or to limit its scope to breaches of duty to third parties."]; HealthNow NY, Inc. v David Home Bldrs., Inc., 176 AD3d 1602, 1605 [4th Dept 2019] [emphasizing the "highly inclusive" language in rejecting application of Hooper]; Square Mile Structured Debt (One), LLC v Swig, 110 AD3d 449, 449 [1st Dept 2013] ["The indemnification clause at issue provides for coverage of extremely broad claims, and is consistent with other clauses that have been held to provide for indemnification of attorney's fees for intra-party disputes."]; see also Mid-Hudson Catskill Rural Migrant Ministry, Inc. v Fine Host Corp., 418 F.3d 168, 178 [2d Cir. 2005] [Sotomayor, J.] [rejecting application of Hooper when there was "an indemnity clause that sweeps more broadly, providing for reimbursement of attorney's fees regardless of the nature of the underlying action"]).

Here, to the extent that MVHS may be at fault, no limiting language indicates that it should not indemnify Ramboll for "Losses" related to its proportion of fault. Because "Losses" expressly includes reasonable attorney fees, MVHS may be required to indemnify Ramboll for attorney fees to the extent of its proportional fault. Accordingly, the Court denies the motion to dismiss with respect to the contractual indemnification counterclaim.

Common Law Indemnification

A party's right to indemnification may arise from a contract or may be implied "based upon the law's notion of what is fair and proper as between the parties" (Mas v Two Bridges Assoc., 75 NY2d 680, 690 [1990]). "Implied[, or common-law,] indemnity is a restitution concept which permits shifting the loss because to fail to do so would result in the unjust enrichment of one party at the expense of the other" (id., citing McDermott v City of New York, 50 NY2d 211, 216—217 [1980]; see also Rosado v Proctor & Schwartz, 66 NY2d 21, 24 [1985] [indemnity may be implied "to prevent a result which is regarded as unjust or unsatisfactory" and "is frequently employed in favor of one who is vicariously liable for the tort of another" (internal quotation marks and citations omitted)]). Common-law indemnification is generally available "in favor of one who is held responsible solely by operation of law because of his relation to the actual wrongdoer" (Mas, 75 NY2d at 690; see D'Ambrosio v City of New York, 55 NY2d 454, 460 [1982]).

The "common-law right of indemnification against the party actually at fault encompasses the right to recover attorneys' fees, costs, and disbursements incurred in connection with defending the suit brought by the injured party" (Chapel v Mitchell, 84 NY2d 345, 347 [1994]). "It is a familiar principle that a cause of action for common-law indemnification must be based upon a defendant's breach of duty to a third party" (WSA Group, PE-PC v DKI Eng'g & Consulting USA PC, 178 AD3d 1320, 1323 [3d Dept 2019] [emphasis added]; see e.g. State of NY Workers' Compensation Bd. v Madden, 119 AD3d 1022, 1024 [3d Dept 2014]; Germantown Cent. School Dist. v Clark, Clark, Millis & Gilson, 294 AD2d 93, 99 [3d Dept 2002], affd 100 NY2d 202 [2003]; SCE Envtl. Group, Inc. v Murnane Bldg. Contrs., Inc., 81 Misc 3d 1212[A] at *15-16 [Sup Ct, Albany County 2023]). Further, a party seeking common-law indemnification must establish that "it has been held to be vicariously liable without proof of any negligence or actual supervision on its own part" (Ignatowski v Ledgestone Village LLC, 242 AD3d 1620, 1621 [4th Dept 2025], quoting McCarthy v Turner Constr. Inc., 17 NY3d 369, 377-378 [2011] ["a party cannot obtain common-law indemnification unless it has been held to be vicariously liable without proof of any negligence or actual supervision on its own part. But a party's (e.g., a general contractor's) authority to supervise the work and implement safety procedures is not alone a sufficient basis for requiring common-law indemnification. Liability for indemnification may only be imposed against those parties (i.e., indemnitors) who exercise actual supervision"]).

Ramboll's common law indemnification counterclaim fails insofar as it is an intra-party claim, rather than a third-party claim, and because Ramboll's liability to MVHS is not vicarious, but is based upon its "alleged failure to perform its own contractual obligations pursuant to the Agreement" (Genesee/Wyoming YMCA v Bovis Lend Lease LMB, Inc., 98 AD3d 1242, 1245 [4th Dept 2012], quoting Board of Educ. of Hudson City School Dist. v Sargent, Webster, Crenshaw & Folley, 146 AD2d 190, 199 [3d Dept 1989], lv denied 75 NY2d 702 [1990] [internal quotation marks omitted]). "The principle of common-law, or implied indemnification, permits one who has been compelled to pay for the wrong of another to recover from the wrongdoer the damages it paid to the injured party" (17 Vista Fee Assoc. v Teachers Ins. & Annuity Assn. of Am., 259 AD2d 75, 80 [1999]). That principle is inapplicable where, as here, if MVHS recovers it will be for Ramboll's own conduct.

To the extent that Ramboll relied on Moran v Abercrombie & Fitch Co. (18 AD2d 650 [1st Dept 1962]) during oral argument for the proposition that it would be premature to dismiss its counterclaim, it is inapplicable. Moran was based upon a pre-Dole v Dow Chemical Co. (30 NY2d 143 [1972] [allowing comparative apportionment among joint tort-feasors even where their respective degrees of responsibility were not equal]) theory of active and passive negligence and held that a third-party complaint should not be dismissed on a motion to dismiss where, essentially, it might show that the defendant/third party plaintiff was possibly the more responsible party (see Bush Terminal Bldgs. Co. v Luckenbach S.S. Co., 11 AD2d 220, 224 [1st Dept 1960] ["A defendant guilty merely of 'passive' negligence . . . may claim over against another who is guilty of 'active' negligence. In so doing, such a defendant does not sue directly for the damages sustained by the injured party as the result of the accident. Rather, he obtains indemnity for the damages, in terms of the liability he has sustained by reason of his satisfaction of plaintiff's direct damages. Thereby the ultimate burden of his own responsibility (i. e. liability) to the prime plaintiff is shifted to the one who owed him a duty to prevent the accident and—thus also to prevent the liability incurred to the prime plaintiff"]). In addition to Moran being a pre-Dole case, Ramboll is essentially conflating theories of contributory negligence with its affirmative defense to liability. Defendant argues that, at this stage, it is not clear whether Plaintiff bears any responsibility for the damages it suffered, and if it is at least partially responsible for its own damages, it should indemnify Ramboll under the common law. But if Ramboll's affirmative defense is successful, Ramboll will not suffer liability and indemnity will be inapplicable. Accordingly, Moran is inapplicable.

As stated above, common law indemnification does not contemplate intra-party indemnification and is based upon a theory of vicarious liability. Ramboll has not stated any theory under which vicarious liability is applicable. Accordingly, Plaintiff's motion to dismiss the counterclaim for common law indemnification is granted.

Declaratory Judgment

"The general purpose of the declaratory judgment is to serve some practical end in quieting or stabilizing an uncertain or disputed jural relation either as to present or prospective obligations" (James v Alderton Dock Yards, 256 NY 298, 305 [1931], citing Brownell v Board of Educ., Saratoga Springs, 239 NY 369, [1925]). "Where there is no necessity for resorting to the declaratory judgment it should not be employed" (id.). In sum, where a party has an "adequate, alternative remedy in another form of action," a cause of action for declaratory judgment is duplicative (Upfront Megatainment, Inc. v Thiam, 215 AD3d 576, 578 [1st Dept 2023]; Main Evaluations, Inc. v State, 296 AD2d 852, 853 [4th Dept 2002]).

Here, Ramboll's declaratory judgment claim asks the Court to determine the parties' rights to indemnity under the Agreement. Because resolution of its contractual indemnification claim will necessarily require determination of whether Ramboll has a right to indemnification under the Agreement, the same relief sought in the declaratory judgment cause of action, it may be dismissed as duplicative (see BGW Dev. Corp. v Mount Kisco Lodge No. 1552 of Benevolent & Protective Order of Elks of U.S. of Am., 247 AD2d 565, 568 [2d Dept 1998]; Board of Mgrs. of the 125 N. 10th Condominium v 125North10, LLC, 51 Misc 3d 585, 590 [Sup Ct, Kings County 2016]).

Accordingly, after careful consideration of the papers and oral argument, it is hereby

ORDERED that Plaintiff's motion to dismiss Defendant's counterclaims is granted in part in so far as Defendant's second counterclaim for common law indemnification and third counterclaim for declaratory judgment are dismissed; and it is further

ORDERED that Plaintiff's motion to dismiss Defendant's is otherwise denied.

This constitutes the Decision and Order of the Court.

ENTER:

Dated: 8/12/2026

Utica, New York

Hon. Elizabeth Snyder Fortino, J.S.C.

FOOTNOTES

1.   The contract contained the following provision relating to Breed, Abbott's liability and its right to indemnification as escrowee: "The escrowee shall not be liable to either of the parties for any act or omission except for bad faith or gross negligence, and the parties hereby indemnify the escrowee and hold the escrowee harmless from any claims, damages, losses or expenses arising in connection herewith."

2.   "[t]he Partnership and other Partners shall be indemnified and held harmless... from and against any and all claims, demands, liabilities, costs, damages, expenses and causes of action of any nature whatsoever arising out of or incidental to any act performed by a Partner ...not performed in good faith or ...not reasonably believed ...to be in the [Partnership's] best interest ...and within the [Partner's] authority" (emphasis added).

Elizabeth Snyder Fortino, J.