Brief Fact Summary.
The defendants sought to implead their attorneys under a contribution and indemnification claim after being sued for withholding a commission deal with a broker in violation of an investment agreement with Friedmann and other investors.
Synopsis of Rule of Law.
A defendant may not implead a third party to seek contribution and indemnification if there is no equivalent right under the original claim.
Under New York law, controlling effect must be given to the law of the jurisdiction which, because of its relationship or contact with the occurrence or the parties, has the greatest concern with the specific issue raised in the litigation.View Full Point of Law
Friedmann along with other investors entered into an agreement with Hartmann to invest in the purchase and development of commercial properties and not to include brokers in the agreement. The plaintiffs sued Hartmann to recover their investment after finding out that Hartmann secretly signed a deal with a broker. The defendants sought to implead their attorneys claiming that their attorneys did not advise the defendants that they had to disclose their agreement with the brokers. The third party defendants filed a motion to dismiss.
Whether a defendant may implead a third party to seek contribution and indemnification if there is no equivalent right under the original claim?
No. The third party motion to dismiss is granted. The defendants cannot implead a third party for indemnification or contribution because no such rights exists under Connecticut state law. Similarly, Congress made no relief of contribution or indemnification for tortfeasors who violated RICO.
Contribution allows one tortfeasor to recover damages from a third party after paying damages to a plaintiff whereas indemnity shifts the liability to another party.