NIAGARA FOODS INC BENLEY REALTY CO AND THE CHARTER OAK FIRE INSURANCE COMPANY PLAINTIFFS APPELLANTS RESPONDENTS v. FERGUSON ELECTRIC SERVICE COMPANY INC AND TEGG CORPORATION DEFENDANTS RESPONDENTS APPELLANTS

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Supreme Court, Appellate Division, Fourth Department, New York.

NIAGARA FOODS, INC., BENLEY REALTY CO. AND THE CHARTER OAK FIRE INSURANCE COMPANY, PLAINTIFFS–APPELLANTS–RESPONDENTS, v. FERGUSON ELECTRIC SERVICE COMPANY, INC. AND TEGG CORPORATION, DEFENDANTS–RESPONDENTS–APPELLANTS.

CA 11–00333

Decided: July 01, 2011

PRESENT:  SCUDDER, P.J., SMITH, CARNI, SCONIERS, AND GREEN, JJ. LAW OFFICES OF ROBERT A. STUTMAN, P.C., NEW YORK CITY (KEVIN P. SMITH OF COUNSEL), AND BRANDT, ROBERSON & BRANDT, P.C., LOCKPORT, FOR PLAINTIFFS–APPELLANTS–RESPONDENTS. RUPP, BAASE, PFALZGRAF, CUNNINGHAM & COPPOLA LLC, BUFFALO (R. ANTHONY RUPP, III, OF COUNSEL), FOR DEFENDANT–RESPONDENT–APPELLANT FERGUSON ELECTRIC SERVICE COMPANY, INC. WALSH, ROBERTS & GRACE, BUFFALO (MARK P. DELLA POSTA OF COUNSEL), FOR DEFENDANT–RESPONDENT–APPELLANT TEGG CORPORATION.

MEMORANDUM AND ORDER

Appeal and cross appeals from an amended order of the Supreme Court, Niagara County (Ralph A. Boniello, III, J.), entered July 27, 2010.   The amended order, among other things, granted in part defendants' motions to dismiss.

It is hereby ORDERED that the amended order so appealed from is unanimously modified on the law by granting that part of the motion of defendant Ferguson Electric Service Company, Inc. to dismiss the breach of contract cause of action asserted against it by plaintiff Benley Realty Co. and as modified the amended order is affirmed without costs.

With respect to defendants' cross appeals, we reject their contention that the court erred in denying those parts of their motions to dismiss the strict products liability cause of action.   Plaintiffs properly pleaded a cause of action for strict products liability (see Van Iderstine v. Lane Pipe Corp., 89 A.D.2d 459, 460–461, lv dismissed 58 N.Y.2d 610, 1113), and the court was correct that, at this stage of the litigation, there is an issue of fact whether defendants provided a service, a product, or a combination thereof.   We agree with Ferguson, however, that the court erred in denying that part of its motion to dismiss the breach of contract cause of action asserted by plaintiff Benley Realty Co. (Benley) against it inasmuch as Benley did not enter into a contract with Ferguson (see Mandarin Trading Ltd. v. Wildenstein, 16 NY3d 173, 181–182).   Nor has Benley established that it was a third-party beneficiary of the contract between Ferguson and Niagara Foods or that any benefit it received from that contract was sufficiently immediate to establish the assumption of a duty by Ferguson to compensate Benley in the event that the benefit was lost (see id. at 182).   We therefore modify the amended order accordingly.

Patricia L. Morgan

Clerk of the Court