H. R . MOCH COMPANY, INC., Appellant,

v.

RENSSELAER WATER COMPANY, Respondent.

Moch Co. v. Rensselaer Water Co., 219 App. Div. 673, affirmed.

(Submitted December 9, 1927; decided January 10, 1928.)

APPEAL from a judgment, entered March 19, 1927, upon an order of the Appellate Division of the Supreme Court in the third judicial department, which reversed an order of Special Term denying a motion for a dismissal of the complaint and granted said motion.

Glenn A. Frank for appellant. The duties and obligation of the defendant did not arise solely by reason of its contract with the city of Rensselaer, but had their inception in section 81 of the Transportation Corporations Law. (Waterloo Water Co. v. Village of Waterloo, 200 App. Div. 721; Mamaroneck v. New York City Water [162] Co., 203 App. Div. 122; 235 N. Y. 563; City of New York v. Jamaica Water Supply Co., 181 App. Div. 49; 226 N. Y. 572; People ex rel. City of New York v. Queens County Water Co., 232 N. Y. 277; Staten Island Water Supply Company v. City of N. Y., 144 App. Div. 324; Glanzer v. Shepard, 233 N. Y. 236.)

Thomas F. McDermott for respondent. A city assuming the function of extinguishment of fires is not liable to an inhabitant for its negligence. (Springfield Fire Ins.Co. v. Village of Keeseville, 148 N. Y. 46; Maxmilian v. Mayor, etc., 62 N. Y. 160; Oakes Mfg. Co. v. City of New York, 206 N. Y. 221; Matter of International Ry. Co. v. Rann, 224 N. Y. 83; Wainwright v. Queens Co. Water Co., 78 Hun, 146; Wilcox v. Rochester, 190 N. Y. 137.) The non-liability of the city for its negligence in the extinguishment of fires is extended to the defendant, a private water company, to which the city intrusted that governmental function. (German Alliance Ins. Co. v. Home Water Supply Co., 226 U. S. 220; 174 Fed. Rep. 764; Wainwright v. Queens Co. Water Co., 78 Hun, 146; Smith v. Great South Bay Water Co., 82 App. Div. 427; Nichol v. Huntington Water Co., 53 W. Va. 348; Akron Water Co. v. Brownless, 10 Ohio C. C. 620; Dillon on Mun. Corp. [5th ed.] § 1340; Hall v. Passaic Water Co., 83 N. J. L. 771; Baum v. Somerville Water Co., 84 N. J. L. 611; Hone v. Presque Isle Water Co., 104 Maine, 271; Eaton v. Faubin, 37 Neb. 546; House v. Houston W. Co., 88 Tex. 233; Button v. Green Bay Water Co., 81 Wis. 48.) Plaintiff cannot recover in tort. (German Alliance Ins. Co. v. Home W. Co., 226 U. S. 220; Howsman v. Trenton W. Co., 119 Mo. 304; House v. Houston W. Co., 88 Tex. 233; Wilkins v. L. H. W. Co., 78 Miss. 389; Nichol v. Huntington W. Co., 53 W. Va. 348; Root v. Saratoga Spa, 218 App. Div. 237; Fitch v. Seymour Water Co., 139 Ind. 214; Anderson v. Iron Mountain Water Co., 225 Mich. 514.)

[163] CARDOZO, Ch. J.

The defendant, a water works company under the laws of this State, made a contract with the city of Rensselaer for the supply of water during a term of years. Water was to be furnished to the city for sewer flushing and street sprinkling; for service to schools and public buildings; and for service at fire hydrants, the latter service at the rate of $42.50 a year for each hydrant. Water was to be furnished to private takers within the city at their homes and factories and other industries at reasonable rates, not exceeding a stated schedule. While this contract was in force, a building caught fire. The flames, spreading to the plaintiff's warehouse near by, destroyed it and its contents. The defendant according to the complaint was promptly notified of the fire, “but omitted and neglected after such notice, to supply or furnish sufficient or adequate quantity of water, with adequate pressure to stay, suppress or extinguish the fire before it reached the warehouse of the plaintiff, although the pressure and supply which the defendant was equipped to supply and furnish, and had agreed by said contract to supply and furnish, was adequate and sufficient to prevent the spread of the fire to and the destruction of the plaintiff's warehouse and its contents." By reason of the failure of the defendant to “fulfill the provisions of the contract between it and the city of Rensselaer," the plaintiff is said to have suffered damage, for which judgment is demanded. A motion, in the nature of a demurrer, to dismiss the complaint, was denied at Special Term. The Appellate Division reversed by a divided court.

Liability in the plaintiff's argument is placed on one or other of three grounds. The complaint, we are told, is to be viewed as stating: (1) A cause of action for breach of contract within Lawrence v. Fox (20 N. Y. 268); (2) a cause of action for a common-law tort, within MacPherson v. Buick Motor Company (217 N. Y. 382); or (3) a cause of action for the breach of a statutory duty. These several grounds of liability will be considered in succession.

[164] (1) We think the action is not maintainable as one for breach of contract.

No legal duty rests upon a city to supply its inhabitants with protection against fire (Springfield Fire Ins. Co. v. Village of Keeseville, 148 N. Y. 46). That being so, a member of the public may not maintain an action under Lawrence v. Fox against one contracting with the city to furnish water at the hydrants, unless an intention appears that the promisor is to be answerable to individual members of the public as well as to the city for any loss ensuing from the failure to fulfill the promise. No such intention is discernible here. On the contrary, the contract is significantly divided into two branches: one a promise to the city for the benefit of the city in its corporate capacity, in which branch is included the service at the hydrants; and the other a promise to the city for the benefit of private takers, in which branch is included the service at their homes and factories. In a broad sense it is true that every city contract, not improvident or wasteful, is for the benefit of the public. More than this, however, must be shown to give a right of action to a member of the public not formally a party. The benefit, as it is sometimes said, must be one that is not merely incidental and secondary (cf. Fosmire v. Nat. Surety Co., 229 N. Y. 44). It must be primary and immediate in such a sense and to such a degree as to bespeak the assumption of a duty to make reparation directly to the individual members of the public if the benefit is lost. The field of obligation would be expanded beyond reasonable limits if less than this were to be demanded as a condition of liability. A promisor undertakes to supply fuel for heating a public building. He is not liable for breach of contract to a visitor who finds the building without fuel, and thus contracts a cold. The list of illustrations can be indefinitely extended. The carrier of the mails under contract with the government is not answerable to the merchant who has lost the benefit of a bargain through [165] negligent delay. The householder is without a remedy against manufacturers of hose and engines, though prompt performance of their contracts would have stayed the ravages of fire. "The law does not spread its protection so far" (Robins Dry Dock & Repair Co. v. Flint, 275 U.S. 303).

So with the ease at hand. By the vast preponderance of authority, a contract between a city and a water company to furnish water at the city hydrants has in view a benefit to the public that is incidental rather than immediate, an assumption of duty to the city and not to its inhabitants. Such is the ruling of the Supreme Court of the United States (German Alliance Ins. Co. v. Home Water Supply Co., 226 U. S. 220). Such has been the ruling in this State (Wainwright v. Queens County Water Co., 78 Hun, 146; Smith v. Great South Bay Water Co., 82 App. Div. 427), though the question is still open in this court. Such with few exceptions has been the ruling in other jurisdictions (Williston, Contracts, § 373, and cases there cited; Dillon, Municipal Corporations [5th ed.]., § 1340). The diligence of counsel has brought together decisions to that effect from twenty-six States. Typical examples are Alabama (Ellis v. Birmingham Water Co., 187 Ala. 552); California (Nichaus Bros. Co. v. Contra Costa Water Co., 159 Cal. 305); Georgia (Holloway v. Macon G. & W. Co., 132Ga. 387); Connecticut (Nickerson v. Bridgeport H. Co., 46 Conn. 24); Kansas (Mott v. Cherryvale W. & M. Co., 48 Kan. 12); Maine (Hone v. Presque Isle Water Co., 104 Me. 217); New Jersey (Hall v. Passaic Water Co., 83 N. J. L. 771), and Ohio (Blunk v. Dennison Water Co., 71 Ohio St. 250). Only a few States have held otherwise (Page, Contracts, § 2401). An intention to assume an obligation of indefinite extension to every member of the public is seen to be the more improbable when we recall the crushing burden that the obligation would impose (cf. Hone v. Presque Isle Water Co., 104 Me. 217, at 232). The consequences invited would bear [166] no reasonable proportion to those attached by law to defaults not greatly different. A wrongdoer who by negligence sets fire to a building is liable in damages to the owner where the fire has its origin, but not to other owners who are injured when it spreads. The rule in our State is settled to that effect, whether wisely or unwisely (Hoffman v. King, 160 N. Y. 618; Rose v. Penn. R.R. Co., 236 N. Y.568; Moore v. Van Beuren & N. Y. Bill Posting Co., 240 N. Y. 673; cf. Bird v. St. Paul F. & M. Ins. Co., 224 N. Y. 47). If the plaintiff is to prevail, one who negligently omits to supply sufficient pressure to extinguish a fire started by another, assumes an obligation to pay the ensuing damage, though the whole city is laid low. A promisor will not be deemed to have had in mind the assumption of a risk so overwhelming for any trivial reward.

The cases that have applied the rule of Lawrence v. Fox to contracts made by a city for the benefit of the public are not at war with this conclusion. Through them all there runs as a unifying principle the presence of an intention to compensate the individual members of the public in the event of a default. For example, in Pond v. New Rochelle Water Co. (183 N. Y. 330) the contract with the city fixed a schedule of rates to be supplied not to public buildings but to private takers at their homes. In Matter of International Railway Co. v. Rann (224 N. Y. 83,85) the contract was by street railroads to carry passengers for a stated fare. In Smyth v. City of N. Y. (203 N. Y. 106) and Rigney v. N. Y. C. & H. R. R. R. Co. (217 N. Y. 31) covenants were made by contractors upon public works, not merely to indemnify the city, but to assume its liabilities. These and like cases come within the third group stated in the comprehensive opinion in Seaver v. Ransom (224 N. Y. 233, 238). The municipality was contracting in behalf of its inhabitants by covenants intended to be enforced by any of them severally as occasion should arise.

[167] (2) We think the action is not maintainable as one for a common-law tort.

"It is ancient learning that one who assumes to act, even though gratuitously, may thereby become subject  to the duty of acting carefully, if he acts at all " (Glanzer v. Shepard, 233 N. Y. 236, 239; Marks v. Nambil Realty Co., Inc., 245 N. Y. 256, 258). The plaintiff would bring its case within the orbit of that principle. The hand once set to a task may not always be withdrawn with impunity though liability would fail if it had never been applied at all. A time-honored formula often phrases the distinction as one between misfeasance and non-feasance. Incomplete the formula is, and so at times misleading. Given a relation involving in its existence a duty of care irrespective of a contract, a tort may result as well from acts of omission as of commission in the fulfillment of the duty thus recognized by law (Pollock, Torts [12th ed.], p. 555; Kelley v. Met. Ry. Co., 1895, 1 Q. B. 944). What we need to know is not so much the conduct to be avoided when the relation and its attendant duty are established as existing. What we need to know is the conduct that engenders the relation. It is here that the formula, however incomplete, has its value and significance. If conduct has gone forward to such a stage that inaction would commonly result, not negatively merely in withholding a benefit, but positively or actively in working an injury, there exists a relation out of which arises a duty to go forward (Bohlen, Studies in the Law of Torts, p. 87). So the surgeon who operates without pay, is liable though his negligence is in the omission to sterilize his instruments (cf. Glanzer v. Shepard, supra); the engineer, though his fault is in the failure to shut off steam (Kelley v. Met. Ry. Co., supra; cf. Pittsfield Cottonwear Mfg. Co. v. Shoe Co., 71 N. H. 522, 529, 533); the maker of automobiles, at the suit of some one other than the buyer, though his negligence is merely in inadequate inspection (MacPherson [168] v. Buick Motor Co., 217 N. Y. 382). The query always is whether the putative wrongdoer has advanced to such a point as to have launched a force or instrument of harm, or has stopped where inaction is at most a refusal  to become an instrument for good (cf. Fowler v. Athens Waterworks Co., 83 Ga. 219, 222).

The plaintiff would have us hold that the defendant, when once it entered upon the performance of its contract with the city, was brought into such a relation with every one who might potentially be benefited through the supply of water at the hydrants as to give to negligent performance, without reasonable notice of a refusal to continue, the quality of a tort. There is a suggestion of this thought in Guardian Trust Co. v. Fisher (200U. S. 57), but the dictum was rejected in a later case decided by the same court (German Alliance Ins. Co. v. Home Water Supply Co., 226 U. S. 220) when an opportunity was at hand to turn it into law. We are satisfied that liability would be unduly and indeed indefinitely extended by this enlargement of the zone of duty. The dealer in coal who is to supply fuel for a shop must then answer to the customers if fuel is lacking. The manufacturer of goods, who enters upon the performance of his contract, must answer, in that view, not only to the buyer, but to those who to his knowledge are looking to the buyer for their own sources of supply. Every one making a promise having the quality of a contract will be under a duty to the promisee by virtue of the promise, but under another duty, apart from contract, to an indefinite number of potential beneficiaries when performance has begun. The assumption of one relation will mean the involuntary assumption of a series of new relations, inescapably hooked together. Again we may say in the words of the Supreme Court of the United States, "The law does not spread its protection so far" (Robins Dry Dock & Repair Co. v. Flint, supra; cf. Byrd v. English,117Ga. 191; Dale v. Grant, 34 N. J. L. 142;Conn. Ins. [169] Co. v. N. Y. & N. H, R. R. Co., 25 Conn. 265; Anthony v. Slaid, 11 Metc. 290). We do not need to determine now what remedy, if any, there might be if the defendant had withheld the water or reduced the pressure with a malicious intent to do injury to the plaintiff or another. We put aside also the problem that would arise if there had been reckless and wanton indifference to consequences measured and foreseen. Difficulties would be present even then, but they need not now perplex us. What we are dealing with at this time is a mere negligent omission, unaccompanied by malice or other aggravating elements. The failure in such circumstances to furnish an adequate supply of water is at most the denial of a benefit. It is not the commission of a wrong.

(3) We think the action is not maintainable as one for the breach of a statutory duty.

The defendant, a public service corporation, is subject to the provisions of the Transportation Corporations Act. The duty imposed upon it by that act is in substance to furnish water, upon demand by the inhabitants, at reasonable rates, through suitable connections at office, factory or dwelling, and to furnish water at like rates through hydrants or in public buildings upon demand by the city, all according to its capacity (Transportation Corporations Law [Cons. Laws, ch. 63], § 81; Staten Island Water Supply Co. v. City of N. Y., 144 App. Div. 318; People ex rel. City of N. Y. v. Queens Co. Water Co., 232 N. Y. 277;People ex rel. Arthur v. Huntington Water Works Co., 208 App. Div. 807, 808). We find nothing in these requirements to enlarge the zone of liability where an inhabitant of the city suffers indirect or incidental damage through deficient pressure at the hydrants. The breach of duty in any case is to the one to whom service is denied at the time and at the place where service to such one is due. The denial, though wrongful, is unavailing without more to give a cause of action to another. We may finda helpful analogy in the law of common carriers. [170] A railroad company is under a duty to supply reasonable facilities for carriage at reasonable rates. It is liable, generally speaking, for breach of a duty imposed by law if it refuses to accept merchandise tendered by a shipper. The fact that its duty is of this character does not make it liable to some one else who may be counting upon the prompt delivery of the merchandise to save him from loss in going forward with his work. If the defendant may not be held for a tort at common law, we find no adequate reason for a holding that it may be held under the statute.

The judgment should be affirmed with costs.

POUND, CRANE, ANDREWS, LEHMAN and KELLOGG, JJ., concur; O'BRIEN, J., not sitting.

Judgment affirmed, etc.

[492 N.Y.S.2d 556] Bruce L. Birnbaum and Benjamin J. Golub, New York City, for appellant.

William E. Hegarty, Ernest J. Williams, Thomas J. Kavaler, Stanley K. Shapiro and Lisa Schilit, New York City, for respondent.

OPINION OF THE COURT

KAYE, Justice.

On July 13, 1977, a failure of defendant Consolidated Edison's power system left most of New York City in darkness. In this action for damages allegedly resulting from the power failure, we are asked to determine whether Con Edison owed a duty of care to a tenant who suffered personal injuries in a common area of an apartment building, where his landlord--but not he--had a contractual relationship with the utility. We conclude that in the case of a blackout of a metropolis of several million residents and visitors, each in some manner necessarily affected by a 25-hour power failure, liability for injuries in a building's common areas should, as a matter of public policy, be limited by the contractual relationship.

This court has twice before confronted legal questions concerning the 1977 blackout (see, Koch v. Consolidated Edison Co., 62 N.Y.2d 548, 479 N.Y.S.2d 163, 468 N.E.2d 1, cert. denied 469 U.S. 1210, 105 S.Ct. 1177, 84 L.Ed.2d 326, Food Pageant v. Consolidated Edison Co., 54 N.Y.2d 167, 445 N.Y.S.2d 60, 429 N.E.2d 738).

Plaintiff, Julius Strauss, then 77 years old, resided in an apartment building in Queens. Con Edison provided electricity to his apartment pursuant to agreement with him, and to the common areas of the building under a separate agreement with his landlord, defendant Belle Realty Company. As water to the apartment was supplied by electric pump, plaintiff had no running water for the duration of the blackout. Consequently, on the second day of the power failure, he set out for the basement to obtain water, but fell on the darkened, defective basement stairs, sustaining injuries. In this action against Belle Realty and Con Edison, plaintiff alleged negligence against the landlord, in failing to maintain the stairs or warn of their dangerous condition, and negligence against the utility in the performance of its duty to provide electricity.

Plaintiff moved for partial summary judgment against Con Edison (1) to estop it from contesting the charge of gross negligence in connection with the blackout, and (2) to establish that Con Edison owed a duty of care to plaintiff. He argued that Con Edison was prohibited from denying it was grossly negligent by virtue of the affirmed jury verdict in Food Pageant v. Consolidated Edison Co., 54 N.Y.2d 167, 445 N.Y.S.2d 60, 429 N.E.2d 738, supra, and that it owed plaintiff a duty even though he was "not a customer of Consolidated Edison in a place where the accident occurred." Con Edison cross-moved for summary judgment dismissing the complaint, maintaining it had no duty to a noncustomer.

The court granted the motion insofar as it sought collateral estoppel regarding gross negligence,^[1] and denied Con Edison's cross motion to dismiss the complaint, finding a question of fact as to whether it owed plaintiff a duty of care. The Appellate Division reversed and dismissed the complaint against Con Edison. Citing Moch Co. v. Rensselaer Water Co., 247 N.Y. 160, 159 N.E. 896, the plurality concluded that "Con Ed did not owe a duty to plaintiff in any compensable legal sense" (98 A.D.2d 424, 428, 469 N.Y.S.2d 948). Justice Gibbons dissented, finding extension of the duty tolerable here because "tenants of the building in question constitute a defined, limited and known group of people" (id., at p. 437, 469 N.Y.S.2d 948). On public policy grounds, we [492 N.Y.S.2d 557] now affirm the Appellate Division order dismissing the complaint against Con Edison.

A defendant may be held liable for negligence only when it breaches a duty owed to the plaintiff (Pulka v. Edelman, 40 N.Y.2d 781, 782, 390 N.Y.S.2d 393, 358 N.E.2d 1019). The essential question here is whether Con Edison owed a duty to plaintiff, whose injuries from a fall on a darkened staircase may have conceivably been foreseeable, but with whom there was no contractual relationship for lighting in the building's common areas.

Duty in negligence cases is defined neither by foreseeability of injury (Pulka v. Edelman, supra, at p. 785, 390 N.Y.S.2d 393, 358 N.E.2d 1019) nor by privity of contract. As this court has long recognized, an obligation rooted in contract may engender a duty owed to those not in privity, for "is nothing anomalous in a rule which imposes upon A, who has contracted with B, a duty to C and D and others according as he knows or does not know that the subject-matter of the contract is intended for their use" (MacPherson v. Buick Motor Co., 217 N.Y. 382, 393, 111 N.E. 1050). In Fish v. Waverly Elec. Light & Power Co., 189 N.Y. 336, 82 N.E. 150, for example, an electric company which had contracted with the plaintiff's employer to install ceiling lights had a duty to the plaintiff to exercise reasonable care. And in Glanzer v. Shepard, 233 N.Y. 236, 135 N.E. 275, a public weigher, hired by a seller of beans to certify the weight of a particular shipment, was found liable in negligence to the buyer. (See also, Wroblewski v. Otis Elevator Co., 9 A.D.2d 294, 296, 193 N.Y.S.2d 855, Rosenbaum v. Branster Realty Corp., 276 App.Div. 167, 93 N.Y.S.2d 209).

But while the absence of privity does not foreclose recognition of a duty, it is still the responsibility of courts, in fixing the orbit of duty, "to limit the legal consequences of wrongs to a controllable degree" (Tobin v. Grossman, 24 N.Y.2d 609, 619, 301 N.Y.S.2d 554, 249 N.E.2d 419; see also, Howard v. Lecher, 42 N.Y.2d 109, 397 N.Y.S.2d 363, 366 N.E.2d 64), and to protect against crushing exposure to liability (see, Pulka v. Edelman, 40 N.Y.2d 781, 390 N.Y.S.2d 393, 358 N.E.2d 1019, supra; Ultramares Corp. v. Touche, 255 N.Y. 170, 174 N.E. 441). "In fixing the bounds of that duty, not only logic and science, but policy play an important role" (De Angelis v. Lutheran Med. Center, 58 N.Y.2d 1053, 1055, 462 N.Y.S.2d 626, 449 N.E.2d 406; see also, Becker v. Schwartz, 46 N.Y.2d 401, 408, 413 N.Y.S.2d 895, 386 N.E.2d 807). The courts' definition of an orbit of duty based on public policy may at times result in the exclusion of some who might otherwise have recovered for losses or injuries if traditional tort principles had been applied.

Considerations of privity are not entirely irrelevant in implementing policy. Indeed, in determining the liability of utilities for consequential damages for failure to provide service--a liability which could obviously be "enormous," and has been described as "sui generis," rather than strictly governed by tort or contract law principles (see, Prosser and Keeton, Torts § 92, at 663 )--courts have declined to extend the duty of care to noncustomers. For example, in Moch Co. v. Rensselaer Water Co., 247 N.Y. 160, 159 N.E. 896, supra, a water works company contracted with the City of Rensselaer to satisfy its water requirements. Plaintiff's warehouse burned and plaintiff brought an action against the water company in part based on its alleged negligence in failing to supply sufficient water pressure to the city's hydrants. The court denied recovery, concluding that the proposed enlargement of the zone of duty would unduly extend liability. Similarly, in Beck v. FMC Corp., 42 N.Y.2d 1027, 398 N.Y.S.2d 1011, 369 N.E.2d 10, affg. 53 A.D.2d 118, 385 N.Y.S.2d 956), an explosion interrupted a utility's electrical service, which in turn resulted in the loss of a day's pay for hourly workers at a nearby automobile plant. In an action brought by the workers, the court denied recovery on the basis of controlling the unwarranted extension of liability [492 N.Y.S.2d 558] (see also, Nicholson v. City of New York, 271 App.Div. 899, 67 N.Y.S.2d 156, affd. 297 N.Y. 548, 74 N.E.2d 477; Kraye v. Long Is. Light. Co., 42 A.D.2d 972, 348 N.Y.S.2d 16; Shubitz v. Consolidated Edison Co., 59 Misc.2d 732, 301 N.Y.S.2d 926).

Moch involved ordinary negligence, while Con Edison was guilty of gross negligence, but the cases cannot be distinguished on that basis. In reserving the question of what remedy would lie in the case of "reckless and wanton indifference to consequences measured and foreseen" (247 N.Y. at p. 169, 159 N.E. 896), the court in Moch contemplated a level of misconduct greater than the gross negligence involved here (cf. Matter of Almgren v. Fletcher, 304 N.Y. 547, 110 N.E.2d 396; Weld v. Postal Telegraph-Cable Co., 210 N.Y. 59, 103 N.E. 957; 1 N.Y. PJI2d 2:10A Prosser and Keeton, Torts § 34, at 208 ). The court in Food Pageant, in upholding the jury's verdict against Con Edison, noted as instances of Con Edison's misconduct its employee's failure to follow instructions to reduce voltage by "shedding load" after lightning had hit the electrical system, and its staffing decisions (54 N.Y.2d at pp. 173-174, 445 N.Y.S.2d 60, 429 N.E.2d 738, supra). Though found by the jury to constitute gross negligence, this behavior was not so consciously culpable as to fall into the category of conduct contemplated as "reckless and wanton" by the court in Moch (compare, Hall v. Consolidated Edison Co., 104 Misc.2d 565, 428 N.Y.S.2d 837).

In the view of the Appellate Division dissenter, Moch does not control because the injuries here were foreseeable and plaintiff was a member of a specific, limited, circumscribed class with a close relationship with Con Edison. The situation was thought to be akin to White v. Guarente, 43 N.Y.2d 356, 401 N.Y.S.2d 474, 372 N.E.2d 315, where an accounting firm was retained by a limited partnership to perform an audit and prepare its tax returns. As the court noted there, the parties to the agreement contemplated that individual limited partners would rely on the tax returns and audit. Refusing to dismiss a negligence action brought by a limited partner against the accounting firm, the court said, "the services of the accountant were not extended to a faceless or unresolved class of persons, but rather to a known group possessed of vested rights, marked by a definable limit and made up of certain components" (id., at p. 361, 401 N.Y.S.2d 474, 372 N.E.2d 315; see also, Glanzer v. Shepard, 233 N.Y. 236, 135 N.E. 275; supra; Fish v. Waverly Elec. Light & Power Co., 189 N.Y. 336, 82 N.E. 150, supra).

Central to these decisions was an ability to extend the defendant's duty to cover specifically foreseeable parties but at the same time to contain liability to manageable levels. In White, for instance, liability stemmed from a single isolated transaction where the parties to the agreement contemplated the protection of identified individuals. Here, insofar as revealed by the record, the arrangement between Con Edison and Belle Realty was no different from those existing between Con Edison and the millions of other customers it serves. Thus, Con Edison's duty to provide electricity to Belle Realty should not be treated separately from its broader statutory obligation to furnish power to all other applicants for such service in New York City and Westchester County (Transportation Corporations Law § 12; Public Service Law § 31). When plaintiff's relationship with Con Edison is viewed from this perspective, it is no answer to say that a duty is owed because, as a tenant in an apartment building, plaintiff belongs to a narrowly defined class.^[2] [492 N.Y.S.2d 559] Additionally, we deal here with a system-wide power failure occasioned by what has already been determined to be the utility's gross negligence. If liability could be found here, then in logic and fairness the same result must follow in many similar situations. For example, a tenant's guests and invitees, as well as persons making deliveries or repairing equipment in the building, are equally persons who must use the common areas, and for whom they are maintained. Customers of a store and occupants of an office building stand in much the same position with respect to Con Edison as tenants of an apartment building. In all cases the numbers are to a certain extent limited and defined, and while identities may change, so do those of apartment dwellers (compare, White v. Guarente, 43 N.Y.2d 356, 361, 401 N.Y.S.2d 474, 372 N.E.2d 315, supra ). While limiting recovery to customers in this instance can hardly be said to confer immunity from negligence on Con Edison (see, Koch v. Consolidated Edison Co., 62 N.Y.2d 548, 479 N.Y.S.2d 163, 468 N.E.2d 1, supra), permitting recovery to those in plaintiff's circumstances would, in our view, violate the court's responsibility to define an orbit of duty that places controllable limits on liability.

Finally, we reject the suggestion of the dissent that there should be a fact-finding hearing to establish the alleged catastrophic probabilities flowing from the 1977 blackout and prospective blackouts, before any limitation is placed on Con Edison's duty to respond to the public for personal injuries (see, Tobin v. Grossman, 24 N.Y.2d 609, 620, 301 N.Y.S.2d 554, 249 N.E.2d 419 supra ). In exercising the court's traditional responsibility to fix the scope of duty, for application beyond a single incident, we need not blind ourselves to the obvious impact of a city-wide deprivation of electric power, or to the impossibility of fixing a rational boundary once beyond the contractual relationship, or to the societal consequences of rampant liability.

In sum, Con Edison is not answerable to the tenant of an apartment building injured in a common area as a result of Con Edison's negligent failure to provide electric service as required by its agreement with the building owner. Accordingly, the order of the Appellate Division should be affirmed, with costs.

MEYER, Justice (dissenting).

My disagreement with the majority results not from its consideration of public policy as a factor in determining the scope of Con Ed's duty, but from the fact that in reaching its public policy conclusion it has considered only one side of the equation and based its conclusion on nothing more than assumption. I, therefore, respectfully dissent.

As Professors Prosser and Keeton have emphasized (Prosser and Keeton, Torts, at 357-358 ), "The statement that there is or is not a duty begs the essential question--whether the plaintiff's interests are entitled to legal protection against the defendant's conduct * * * It is a shorthand statement of a conclusion, rather than an aid to analysis in itself * * * But it should be recognized that 'duty' is not sacrosanct in itself, but is only an expression of the sum total of those considerations of policy which lead the law to say that the plaintiff is entitled to protection." We accepted the concept without reservation in De Angelis v. Lutheran Med. Center, 58 N.Y.2d 1053, 1055, 462 N.Y.S.2d 626, 449 N.E.2d 406, stating as to the role played by policy that, "A line must be drawn between the competing policy considerations of providing a remedy to everyone who is injured and of extending exposure to tort liability almost without limit."

Although De Angelis did not define the "competing policy considerations" to be reviewed in deciding where the line is to be [492 N.Y.S.2d 560] drawn, it made clear that "absent legislative intervention, the fixing of the 'orbit' of duty, as here, in the end is the responsibility of the courts". Thus, the suggestion in the plurality opinion at the Appellate Division (98 A.D.2d at p. 429, 469 N.Y.S.2d 948) that the liability issue now considered is "best addressed to the Legislature" is no more correct in the present situation than it was when in Codling v. Paglia, 32 N.Y.2d 330, 345 N.Y.S.2d 461, 298 N.E.2d 622 we imposed upon manufacturers the economic burden of strict products liability to bystanders as well as to those in privity.

There is, of course, legislative intervention in the regulation of gas and electric companies (Transportation Corporations Law art. 2; Public Service Law art. 4). But the only "legislative" limitation upon the liability of such companies consists of Public Service Commission acceptance and approval of Con Ed's rate schedule, which incorporates the rule, previously enunciated by this court (Weld v. Postal Telegraph-Cable Co., 199 N.Y. 88, 92 N.E. 415, on second appeal 210 N.Y. 59, 103 N.E. 957), that liability "be limited to damages arising from the utility's willful misconduct or gross negligence" (Food Pageant v. Consolidated Edison Co., 54 N.Y.2d 167, 172, 445 N.Y.S.2d 60, 429 N.E.2d 738). But, as Food Pageant and Koch v. Consolidated Edison Co., 62 N.Y.2d 548, 479 N.Y.S.2d 163, 468 N.E.2d 1, cert. denied 469 U.S. 1210, 105 S.Ct. 1177, 84 L.Ed.2d 326) establish, what caused the injuries for which compensation is sought in this action was Con Ed's gross negligence.

What policy considerations are involved in determining whether Con Ed's gross negligence liability should be extended to "bystanders" and where, if at all, a line should be drawn between the varying bystander situations is, then, the issue to be decided. Codling v. Paglia looked at the total exclusion of the bystander from opportunity to detect a product defect, the system of mass production and distribution, the ability of the manufacturer to pass on, in part if not in whole, the economic burden of postdistribution liability, and the added incentive toward safety that could be expected to result (32 N.Y.2d at p. 341, 345 N.Y.S.2d 461, 298 N.E.2d 622). To that extent at least it departed from the rationale of Moch Co. v. Rensselaer Water Co., 247 N.Y. 160, 168, 159 N.E. 896 that performance of a contract to supply water to a municipality did not impose "another duty, apart from contract, to an indefinite number of potential beneficiaries."

Ultramares Corp. v. Touche, 255 N.Y. 170, 174 N.E. 441, Tobin v. Grossman, 24 N.Y.2d 609, 301 N.Y.S.2d 554, 249 N.E.2d 419 and Pulka v. Edelman, 40 N.Y.2d 781, 390 N.Y.S.2d 393, 358 N.E.2d 1019 on which the majority rely, spoke, it is true, to the necessity of avoiding crushing liability, but articulated no factors by which the crushing nature of the potential liability was to be determined. They can, perhaps, be distinguished from Codling on the ground that the service businesses they involved (accounting, medicine and parking) do not have the potential of Codling's mass distribution system to pass on or absorb the resulting economic burden, but the same cannot be said for the present defendant though it too is involved in furnishing a service.

Criteria more extensive than the unsupported prediction of disaster for determining liability are not wanting, however. Thus, in Tarasoff v. Regents of Univ., 17 Cal.3d 425, 434, 131 Cal.Rptr. 14, 22, 551 P.2d 334, 342), the Supreme Court of California listed the major factors to be balanced in determining duty as "the foreseeability of harm to the plaintiff, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury suffered, the moral blame attached to the defendant's conduct, the policy of preventing future harm, the extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with resulting liability for breach, and the availability, cost and prevalence of insurance for the risk involved." Prosser and Keeton (op. cit., supra at 359), on the basis of the Tarasoff case and Vu v. Singer Co., 538 F.Supp. 26, affd. 9th Cir., 706 [492 N.Y.S.2d 561] F.2d 1027, cert. denied 464 U.S. 938, 104 S.Ct. 350, 78 L.Ed.2d 315, list similar factors, which are discussed at greater length in section 4 of their treatise. As to the loss distribution factor, they note (op. cit., at 24-25) that, "The defendants in tort cases are to a large extent public utilities, industrial corporations, commercial enterprises, automobile owners, and others who by means of rates, prices, taxes or insurance are best able to distribute to the public at large the risks and losses which are inevitable in a complex civilization. Rather than leave the loss on the shoulders of the individual plaintiff, who may be ruined by it, the courts have tended to find reasons to shift it to the defendants", except where there are "limitations upon the power of a defendant to shift the loss to the public * * * where the liability may extend to an unlimited number of unknown persons, and is incapable of being estimated or insured against in advance."

The majority's blind acceptance of the notion that Consolidated Edison will be crushed if held liable to the present plaintiff and others like him ignores the possibility that through application to the Public Service Commission Con Ed can seek such reduction of the return on stockholders' equity (Public Service Law § 66 cf. Matter of Consolidated Edison Co. v. Public Serv. Commn., 74 A.D.2d 384, 428 N.Y.S.2d 343, appeal dismissed 51 N.Y.2d 877, 433 N.Y.S.2d 1030, 414 N.E.2d 405, lv. denied 51 N.Y.2d 705, 433 N.Y.S.2d 1025, 412 N.E.2d 1327) or increase in its rates, or both, as may be necessary to pay the judgments obtained against it. It ignores as well the burden imposed upon the persons physically injured by Con Ed's gross negligence or, as to those forced to seek welfare assistance because their savings have been wiped out by the injury, the State. Doing so in the name of public policy seems particularly perverse, for what it says, in essence, is the more persons injured through a tort-feasor's gross negligence,^[*] the less the responsibility for injuries incurred.

I agree that there are situations encompassed by our tort system that require such a result, perverse though it may be, but before granting public utilities absolution beyond that which they already enjoy through the limitation of their liability to acts of gross negligence, I would put the burden upon the utility to establish the necessity for doing so. I am not suggesting that the issue is to be determined by a jury for, as already noted, I do not question that "duty" is a question of law to be determined by the courts. But the law is not without illustrations of preliminary issues involving facts to be determined by a Judge (e.g., competency and privilege of witnesses, Richardson, Evidence § 117 Morgan, Evidence § 53 suppression of evidence, CPL 710.60; Richardson, op cit. § 550). Nor am I necessarily suggesting that a retrospective determination of how crushing the liability from the 1977 blackout may be, as distinct from a more generalized prospective determination, should govern, although I would not balk at the former if the latter proved impossible of demonstration. All that I am suggesting is that it is Con Ed which claims that its duty does not encompass plaintiff, not because Con Ed was not grossly negligent, but because the effect of that negligence if Con Ed is held liable for it would be to cripple Con Ed as well as the victims of the negligence. There simply is no basis other than the majority's say so for its assumptions (majority opn., at p. 405, 492 N.Y.S.2d at p. 559, 482 N.E.2d at p. 38) that the impact of a city-wide deprivation of electric power upon the utility is entitled to greater consideration than the impact upon those injured; that a rational boundary cannot be fixed that will include some (apartment tenants injured in common areas, for example), if not all of the injured; that the consequence of imposing [492 N.Y.S.2d 562] some bystander liability will be more adverse to societal interests than will follow from blindly limiting liability for tort to those with whom the tort-feasor has a contractual relationship. Before we grant Con Ed's motion to dismiss, therefore, we should require that a rational basis for such assumptions be established.

Con Ed may well be able to do so, but before its motion is granted at the expense of an unknown number of victims who have suffered injuries the extent and effects of which are also unknown, it should be required to establish that the catastrophic probabilities are great enough to warrant the limitation of duty it seeks (cf. Tobin v. Grossman, 24 N.Y.2d 609, 620, 301 N.Y.S.2d 554, 249 N.E.2d 419 supra ).

I would, therefore, deny the summary judgment motions of both sides and remit to Supreme Court for determination of the preliminary fact issues involved.

WACHTLER, C.J., and SIMONS, ALEXANDER and TITONE, JJ., concur with KAYE, J.

MEYER, J., dissents and votes to reverse in a separate opinion in which JASEN, J., concurs.

Order affirmed, with costs.

[1] The collateral estoppel question was decided against Con Edison in Koch v. Consolidated Edison Co., 62 N.Y.2d 548, 479 N.Y.S.2d 163, 468 N.E.2d 1.

[2] In deciding that public policy precludes liability to a noncustomer injured in the common areas of an apartment building, we need not decide whether recovery would necessarily also be precluded where a person injured in the home is not the family bill payer but the spouse. In another context, where this court has defined the duty of a public accounting firm for negligent financial statements, we have recognized that the duty runs both to those in contractual privity with the accountant and to those whose bond is so close as to be, in practical effect, indistinguishable from privity, and we have on public policy grounds precluded wider liability to persons damaged by the accountant's negligence. (See, Credit Alliance Corp. v. Andersen & Co., 65 N.Y.2d 536, 493 N.Y.S.2d 435, 483 N.E.2d 110.) [decided herewith].)

[*] Nor can I accept the "consciously culpable" distinction which the majority seeks to impose between Con Ed and the employee who failed to "shed load." If, as Ultramares holds (255 N.Y. 170, at p. 193, 174 N.E. 441), the employer can be held for its subordinate's fraud, absent a showing that the subordinate acted out of an interest adverse to the employer, the same should be true of gross negligence.

66 Kan. 649

THE UNION PACIFIC RAILWAY COMPANY

V.

ADELINE CAPPIER.

No. 13,073. (72 Pac. 281.)

SYLLABUS ISY THE COURT.

1. RAILROADS—Injury to Trespasser—Duty of Employees. A trespasser on a railway-track was struck by a moving car to which an engine was attached, and injured without fault on the part of the servants of the company. Held, that the failure of the railway employees operating the car and engine to take charge of the wounded man and give him care and attention was not the violation of a legal duty for which the company was liable.

2.—Case Distinguished. The case at bar is distinguishable from those where the servants of the railway company were at fault, and also from those where the injury was occasioned without fault, and the negligent acts or omissions occurred after the company had taken the injured person in charge.

Error from Wyandotte district court; E. L. FISCHER, judge. Opinion filed April 11, 1903. Reversed.

N. H. Loomis, R. W. Blair, and II. A. Scandrett, for plaintiff in error.

C. W. Trickett, for defendant in error.

The opinion of the court was delivered by

SMITH, J.:

This was an action brought by Adeline Cappier, the mother of Irvin Ezelle, to recover damages resulting to her by Reason of the loss of her son, [650] who was run over by a car of plaintiff in error, and died from the injuries received. The trial court, at the close of the evidence introduced to support a recovery by plaintiff below, held that no careless act of the railway company's servants in the operation of the car was shown, and refused to permit the case to be considered by the jury on the allegations and attempted proof of such negligence. The petition, however, contained an averment that the injured person had one leg and an arm cut off by the car-wheels, and that the servants of the railway company failed to call, a surgeon, or to render him any assistance after the accident, but permitted him to remain by the side of the tracks and bleed to death. Under this charge of negligence a recovery was had.

While attempting to cross the railway-tracks Ezelle was struck by a moving freight-car pushed by an engine. A yardmaster in charge of the switching operations was riding on the end of the car nearest to the deceased and gave warning by shouting to him. The warning was either too late or no heed was given to it. The engine was stopped. After the injured man was clear of the track, the yardmaster signaled the engineer to move ahead, fearing, as he testified, that a passenger-train then about due would come upon them. The locomotive and car went forward over a bridge, where the general yardmaster was informed of the accident and an ambulance was summoned by telephone. The yardmaster then went back where the injured man was lying and found three Union Pacific switchmen binding up the wounded limbs and doing what they could to stop the flow of blood. The ambulance arrived about thirty minutes later and Ezelle was taken to a hospital, where he died a few hours afterward.

[651] In answer to particular questions of fact, the jury found that the accident occurred at 5:35 P.M.; that immediately one of the railway employees telephoned to police headquarters for help for the injured man; that the ambulance started at 6:05 P.M. and reached the nearest hospital with Ezelle at 6:20 P.M., where he received proper medical and surgical treatment. Judgment against the railway company was based on the following question and answer:

"Ques. Did not defendant's employees bind up Ezelle's wounds and try to stop the How of blood as soon as they could after the accident happened? Ans. No."

The lack of diligence in the respect stated was intended, no doubt, to apply to the yardmaster, engineer and fireman in charge of the car and engine.

These facts bring us to a consideration of the legal duty of these employees toward the injured man after his condition became known. Counsel for defendant in error quotes the language found in Beach on Contributory Negligence, third edition, section 215, as follows:

"Under certain circumstances, the railroad may owe a duty to a trespasser after the injury. When a trespasser has been run down, it is the plain duty of the railway company to render whatever service is possible to mitigate the severity of the injury. The train that has occasioned the harm must be stopped, and the injured person looked after; and, when it seems necessary, removed to a place of safety, and carefully nursed, until other relief can be brought to the disabled person."

The principal authority cited in support of this doctrine is Northern Central Railway Co. v. The, State, use of Price et al., 29 Md. 420, 96 Am. Dec. 545. The court in that case first held that there was evidence [652] enough to justify the jury in finding that the operatives of the train were negligent in running it too fast over a road-crossing without sounding the whistle, and that the number of brakemen was insufficient to check its speed. Such negligence was held sufficient to uphold the verdict and would seem to be all that was necessary to be said. The court, however, proceeded to state that, from whatever cause the collision occurred, it was the duty of the servants of the company, when the map was found on the pilot of the engine in a helpless and insensible condition, to remove him, and to do it with proper regard to his safety and the laws of humanity. In that case the injured person was taken in charge by the servants of the railway company and, being apparently dead, without notice to his family, or sending for a physician to ascertain his condition, he was moved to defendant's warehouse, laid on a plank and locked up for the night. The next morning, when the warehouse was opened, it was found that during the night the man had revived from his stunned condition and moved some paces from the spot where he had been laid, and was found in a stooping posture, dead but still warm, having died from hemorrhage of the arteries of one leg, which was crushed at and above the knee. It had been proposed to place him in the defendant's station-house, which was a comfortable building, but the telegraph operator objected, and directed him to be taken into the warehouse, a place used for the deposit of old barrels and other rubbish.

The Maryland case does not support what is so broadly stated in Beach on Contributory Negligence. It is cited by Judge Cooley, in his work on Torts, in a note to a chapter devoted to the negligence of bailees (ch. XX), indicating that the learned author under [653] stood the reasoning of the decision to apply where the duty began after the railway employees had taken charge of the injured person.

"After the trespasser on the track of a railway company has been injured in collision with a train, and the servants of the company have assumed to take charge of him, the duty arises to exercise such care in his treatment as the circumstances will allow. We are unable, however, to approve the doctrine that when the acts of a trespasser himself result in his injury, where his own negligent conduct is alone the cause, those in charge of the instrument which inflicted the hurt, being innocent of wrong-doing, are nevertheless blamable in law if they neglect to administer to the sufferings of him whose wounds we might say were self-imposed. With the humane side of the question courts are not concerned. It is the omission or negligent discharge of legal duties only which come within the sphere of judicial cognizance. For withholding relief from the suffering, for failure to respond to the calls of worthy charity, or for faltering in the bestowment of brotherly love on the unfortunate, penalties are found not in the laws of men but in that higher law, the violation of which is condemned by the voice of conscience, whose sentence of punishment for the recreant act is swift and sure. In the law of contracts it is now well understood that a promise founded on a moral obligation will not be enforced in the courts. Bishop states that some of the older authorities recognize amoral obligation as valid, and says:

"Such a doctrine, carried to its legitimate results, would release the tribunals from the duty to administer the law, of the land; and put, in the place of law, the varying ideas of morals which the changing in [654] cumbents of the bench might from time to time entertain." (Bish. Cont. §44.)

Ezelle's injuries were inflicted, as the court below held, without the fault of the yardmaster, engineer or fireman in charge of the car and locomotive. The railway company was no more responsible than it would have been had the deceased been run down by the cars of another railroad company on a track parallel with that of plaintiff in error. If no duty was imposed on the servants of defendant below to take charge of, and care for, the wounded man in such a case, how could a duty arise under the circumstances of the case at bar? In Barrows on Negligence, page 4, it is said:

"The duty must be owing from the defendant to the plaintiff, otherwise there can be no negligence, so far as the plaintiff is concerned; . . . and the duty must be owing to plaintiff in an individual capacity, and not merely as one of the general public.

"This excludes from actionable negligence all failures to observe the obligations imposed by charity, gratitude, generosity, and the kindred virtues. The moral law would obligate an attempt to rescue a person in a perilous position,— as a drowning child,— but the law of the land does not require it, no matter how little personal risk it might involve, provided that the person who declines to act is not responsible for the peril." (See, also, Kenney v. The Hannibal & St. Joseph Railroad Company, 70 Mo. 252, 257.)

In the several cases cited in the brief of counsel for defendant in error to sustain the judgment of the trial court it will be found that the negligence on which recoveries were based occurred after the time when the person injured was in the custody and care of those who were at fault in failing to give him proper treatment.

[655] The judgment of the court below will be reversed, with directions to enter judgment on the findings of the jury in favor of the railway company.

All the Justices concurring.

[499 N.W.2d 473] Syllabus by the Court

1. An affirmative duty to act for the protection of another only arises when a special relationship exists between the parties.

2. A special relationship does not exist between a "social host" of a private boat and a guest on that boat.

Gene P. Bradt, Hansen, Dordell, Bradt, Odlaug & Bradt, St. Paul, for appellant.

Sharon L. VanDyck, Michael A. Zimmer, Schwebel, Goetz, Sieben & Moskal, Minneapolis, for respondent.

Heard, considered, and decided by the court en banc.

OPINION

PAGE, Justice.

This case arises upon a reversal by the court of appeals of summary judgment in favor of the defendant. The court of appeals held that defendant, the owner and operator of a private boat on Lake Minnetonka, had a duty to warn plaintiff, a guest on the boat, that water surrounding the boat was too shallow for diving. We reverse and reinstate judgment in favor of defendant.

The facts are undisputed for the purpose of this appeal. On Sunday, August 9, 1986, Jeffrey Harper ("Harper") was one of four guests on Theodor Herman's ("Herman") 26-foot boat, sailing on Lake Minnetonka. Harper was invited on the boat outing by Cindy Alberg Palmer, another guest on Herman's boat. Herman and Harper did not know each other prior to this boat outing. At the time Herman was 64 years old, and Harper was 20 years old. Herman was an experienced boat owner having spent hundreds of hours operating boats on Lake Minnetonka similar to the one involved in this action. As owner of the boat, Herman considered himself to be in charge of the boat and his passengers. Harper had some experience swimming in lakes and rivers, but had no formal training in diving.

After a few hours of boating, the group decided to go swimming and, at Herman's suggestion, went to Big Island, a popular recreation spot. Herman was familiar with Big Island, and he was aware that the water remains shallow for a good distance away from its shore. Harper had been to Big Island on one previous occasion. Herman positioned the boat somewhere between 100 to 200 yards from the island with the bow facing away from the island in an area shallow enough for his guests to use the boat ladder to enter the water, but still deep enough so they could swim.^[1] The bottom of the lake was not visible from the [499 N.W.2d 474] boat. After positioning the boat Herman proceeded to set the anchor and lower the boat's ladder which was at its stern.

While Herman was lowering the ladder, Harper asked him if he was "going in." When Herman responded yes, Harper, without warning, stepped onto the side of the middle of the boat and dove into approximately two or three feet of water. As a result of the dive, Harper struck the bottom of the lake, severed his spinal cord, and was rendered a C6 quadriplegic.

Harper then brought suit, alleging that Herman owed him a duty of care to warn him that the water was too shallow for diving. On October 23, 1991, the trial court granted Herman's motion for summary judgment, ruling that the law does not impose such a duty. In reversing the trial court, the court of appeals concluded that Herman voluntarily assumed a duty to exercise reasonable care when he allowed Harper onto his boat, and that the duty of care included warning Harper not to dive because he knew that the water was "dangerously shallow." Harper v. Herman, 487 N.W.2d 908, 910 (Minn.App.1992).

The sole issue on appeal is whether a boat owner who is a social host owes a duty of care to warn a guest on the boat that the water is too shallow for diving.

Harper alleges that Herman owed him a duty to warn of the shallowness of the water because he was an inexperienced swimmer and diver, whereas Herman was a veteran boater. Under those circumstances, Harper argues, Herman should have realized that Harper needed his protection.

We have previously stated that an affirmative duty to act only arises when a special relationship exists between the parties. "The fact that an actor realizes or should realize that action on his part is necessary for another's aid or protection does not of itself impose upon him a duty to take such action * * * unless a special relationship exists * * * between the actor and the other which gives the other the right to protection." Delgado v. Lohmar, 289 N.W.2d 479, 483 (Minn.1979), reh'g denied, Jan. 11, 1980 (citations omitted). Accepting, arguendo, that Herman should have realized that Harper needed protection, Harper must still prove that a special relationship existed between them that placed an affirmative duty to act on the part of Herman.

Harper argues that a special relationship requiring Herman to act for his protection was created when Herman, as a social host, allowed an inexperienced diver on his boat. Generally, a special relationship giving rise to a duty to warn is only found on the part of common carriers, innkeepers, possessors of land who hold it open to the public, and persons who have custody of another person under circumstances in which that other person is deprived of normal opportunities of self-protection. Restatement (Second) of Torts Sec. 314A (1965). Under this rule, a special relationship could be found to exist between the parties only if Herman had custody of Harper under circumstances in which Harper was deprived of normal opportunities to protect himself.^[2] These elements are not present here.

The record before this court does not establish that Harper was either particularly vulnerable or that he lacked the ability to protect himself. Further, the record does not establish that Herman held considerable power over Harper's welfare, or that Herman was receiving a financial gain by hosting Harper on his boat. Finally, there is nothing in the record which would suggest that Harper expected any protection [499 N.W.2d 475] from Herman; indeed, no such allegation has been made.

The court of appeals found that Herman owed Harper a duty to warn him of the shallowness of the water because Herman knew that it was "dangerously shallow." We have previously stated that "[a]ctual knowledge of a dangerous condition tends to impose a special duty to do something about that condition." Andrade v. Ellefson, 391 N.W.2d 836, 841 (Minn.1986) (holding that county was not immune to charge of improper supervision of day care center where children were abused when county knew about overcrowding at the center). However, superior knowledge of a dangerous condition by itself, in the absence of a duty to provide protection, is insufficient to establish liability in negligence. Thus, Herman's knowledge that the water was "dangerously shallow" without more does not create liability. Andrade involved a group of plaintiffs who had little opportunity to protect themselves, children in day care, and a defendant to whom the plaintiffs looked for protection. In this case, Harper was not deprived of opportunities to protect himself, and Herman was not expected to provide protection.

"There are many dangers, such as those of fire and water, * * * which under ordinary conditions may reasonably be expected to be fully understood and appreciated by any child * * *." Restatement (Second) of Torts Sec. 339 cmt. j (1965). If a child is expected to understand the inherent dangers of water, so should a 20-year-old adult. Harper had no reasonable expectation to look to Herman for protection, and we hold that Herman had no duty to warn Harper that the water was shallow.

Reversed and judgment in favor of defendant reinstated.

[1] Herman disputes that the boat was this far from shore, but for purposes of this appeal stipulates to Harper's allegation.

[2] Prosser describes a circumstance in which one party would be liable in negligence because another party was deprived of normal opportunities for self-protection as occurring when

the plaintiff is typically in some respect particularly vulnerable and dependent upon the defendant who, correspondingly, holds considerable power over the plaintiff's welfare. In addition, such relations have often involved some existing or potential economic advantage to the defendant. Fairness in such cases thus may require the defendant to use his power to help the plaintiff, based upon the plaintiff's expectation of protection, which itself may be based upon the defendant's expectation of financial gain.

W. Page Keeton et al., Prosser and Keeton on the Laws of Torts Sec. 56, at 374 (5th ed. 1984).

[240 N.W.2d 218] [396 Mich. 284] Young, O'Rourke, Bruno & Bunn, by James C. Bruno, Detroit, for plaintiff-appellant.

William G. Jamison, Martin, Bohall, Joselyn, Halsey, Rowe & Jamieson, P.C., Deftroit, for defendants-appellees.

LEVIN, Justice.

There is ample evidence to support the jury determination that David Siegrist failed to exercise reasonable care after voluntarily coming to the aid of Richard Farwell and that his negligence was the proximate cause of Farwell's death. We are also of the opinion that Siegrist, who was with Farwell the evening he was fatally injured and, as the jury found, knew or should have known of his peril, had an affirmative duty to come to Farwell's aid.^[1]

[396 Mich. 285] I

On the evening of August 26, 1966, Siegrist and Farwell drove to a trailer rental lot to return an automobile which Siegrist had borrowed from a friend who worked there. While waiting for the friend to finish work, Siegrist and Farwell consumed some beer.

Two girls walked by the entrance to the lot. Siegrist and Farwell attempted to engage them in conversation; they left Farwell's car and followed the girls to a drivein restaurant down the street.

The girls complained to their friends in the restaurant that they were being followed Six boys chased Siegrist and Farwell back to the lot. Siegrist escaped unharmed, but Farwell was severely beaten. Siegrist found Farwell underneath his automobile in the lot. Ice was applied to Farwell's head. Siegrist then drove Farwell around for approximately two hours, stopping at a number of drive-in restaurants. Farwell went to sleep in the back seat of his car. Around midnight Siegrist drove the car to the home of Farwell's grandparents, parked it in the driveway, unsuccessfully attempted to rouse Farwell, and left. Farwell's grandparents discovered him in the car the next morning and took him to the hospital. He died three days later of an epidural hematoma.

At trial, plaintiff contended that had Siegrist taken Farwell to the hospital, or had he notified someone of Farwell's condition and whereabouts, Farwell would not have died. A neurosurgeon testified that if a person in Farwell's condition is taken to a doctor before, or within half an hour after, consciousness is lost, there is an 85 to 88 per cent chance of survival. Plaintiff testified that Siegrist told him that he knew Farwell was badly injured and that he should have done something.

[396 Mich. 286] The jury returned a verdict for plaintiff and awarded $15,000 in damages. The Court of Appeals reversed, finding that Siegrist had not assumed the duty of obtaining aid for Farwell and that he neither knew nor should have known of the need for medical treatment.

II

Two separate, but interrelated questions are presented:

A. Whether the existence of a duty in a particular case is always a matter of law to be determined solely by the Court?

B. Whether, on the facts of this case, the trial judge should have ruled, as a matter of law, that Siegrist owed no duty to Farwell?

A.

'A duty, in negligence cases, may be defined as an obligation, to which the law will give recognition and effect, to conform to a particular standard of conduct toward another.' Prosser, Torts (4th ed.), § 53, p. 324.

The existence of a duty is ordinarily a question of law. However, there are factual circumstances which give rise to a duty. The existence of those facts must be determined by a jury.^[2] In Bonin v. Gralewicz, 378 Mich. 521, 526--527, 146 N.W.2d 647, [240 N.W.2d 220] 649 (1966), this Court reversed a directed verdict of no cause of action where the trial court had determined [396 Mich. 287] as a matter of law that the proofs were insufficient to establish a duty of care:

'Usually, in negligence cases, whether a duty is owed by the defendant to the plaintiff does not require resolution of fact issues. However, in some cases, as in this one, fact issues arise. When they do, they must be submitted to the jury, our traditional finders of fact, for ultimate resolution, and they must be accompanied by an appropriate conditional instruction regarding defendant's duty, conditioned upon the jury's resolution of the fact dispute.'

This same rule was stated more recently in Davis v. Thornton, 384 Mich. 138, 142, 180 N.W.2d 11, 13 (1970). 'The trial judge in this case determined the defendant owed the pliantiff no duty. We believe this conclusion could properly be made only by a jury.'

B.

Without regard to whether there is a general duty to aid a person in distress, there is a clearly recognized legal duty of every person to avoid any affirmative acts which may make a situation worse. '(I)f the defendant does attempt to aid him, and takes charge and control of the situation, he is regarded as entering voluntarily into a relation which is attended with responsibility. Such a defendant will then be liable for a failure to use reasonable care for the protection of the plaintiff's interests.' Prosser, Supra, § 56, pp. 343--344. 'Where performance clearly has been begun, there is no doubt that there is a duty of care.' Id. 346.

In a case such as the one at bar, the jury must determine, after considering all the evidence, whether the defendant attempted to aid the victim. [396 Mich. 288] If he did, a duty arose which required defendant to act as a reasonable person.

'Before any duty, or any standard of conduct may be set, there must first be proof of facts which give rise to it,' Prosser, Supra, § 37, p. 205. Whether those facts have been proved is a question for the jury.

'Professor Green argues that it is impossible in the nature of things for the duty problem to be decided by the jury, for it the court sends the issue to the jury this 'necessarily operates as a ruling that there is a duty or else he would never have submitted the case to the jury at all.' But that is not so. As in the case of any other issue, the judge will leave the question to the jury if it is a debatable one, but the jury may decide that (for example) plaintiff was beyond the apparent scope of danger from defendant's conduct, and so beyond the scope of the duty to perform it carefully, even where they are quite ready to find defendant's conduct clearly below the standard of reasonable care.' 2 Harper & James, The Law of Torts, p. 1060.

There was ample evidence to show that Siegrist breached a legal duty owed Farwell. Siegrist knew that Farwell had been in a fight, and he attempted to believe Farwell's pain by applying an ice pack to his head. While Farwell and Siegrist were riding around, Farwell crawled into the back seat and laid down. The testimony showed that Siegrist attempted to rouse Farwell after driving him home but was unable to do so.

In addition, Farwell's father testified to admissions made to him by Siegrist:

'Q. Witness, just before the jury was excused, I asked whether you had any conversation with Mr. Siegrist after this event occurred. You answered, 'Yes, the day [396 Mich. 289] after in the living room of Mrs. Grenier's (the deceased's mother) home.' Then, the jury was excused, and we made [240 N.W.2d 221] a special record, and now I would like to ask you some questions that I asked and that you answered out of the presence of the jury.

'A. Yes.

'Q. What did Mr. Siegrist say, how did the conversation go?

'A. I asked him why he left Ricky (the deceased) in the driveway of his grandfather's home.

'Q. What did he say?

'A. He said, 'Ricky was hurt bad, I was scared.' I said, 'Why didn't you tell somebody, tell his grandparents?' He said, 'I know I should have, I don't know." (Emphasis added).

The question at trial came down to whether, siegrist acted reasonably under all the circumstances. 'The Law of negligence is that an actor is held to the standard of a reasonable man. The determination of the facts upon which the judgment of reasonableness is based is admittedly for the jury.' Davis v. Thornton, 384 Mich. 138, 142--143, 180 N.W.2d 11, 13 (1970).

The jury in this case found that Siegrist did not act reasonably, and that his negligence was the proximate cause of Farwell's death.

"'In considering the question whether defendant was entitled to a directed verdict, the testimony must be construed as strongly as possible in favor of the plaintiff. The specific inquiry is whether this Court can say, as a matter of law, giving to plaintiff's proofs the strongest probative force to which they are entitled, that the evidence was not sufficient to justify submitting to the jury the questions of defendant's negligence and its knowledge or notice of the situation."' Clark v. Dalman, 379 Mich. 251, 263, 150 N.W.2d 755 (1967).

[396 Mich. 290] III 

Siegrist contends that he is not liable for failure to obtain medical assistance for Farwell because he had no duty to do so.

Courts have been slow to recognize a duty to render aid to a person in peril.^[3] Where such a duty has been found, it has been predicated upon the existence of a special relationship between the parties;^[4] in such a case, if defendant knew or should have known of the other person's peril,^[5] he [240 N.W.2d 222] [396 Mich. 291] is required to render reasonable care under all the circumstances.^[6]

In Depue v. Flatau, 100 Minn. 299, 111 N.W. 1 (1907), the Supreme Court of Minnesota reversed an order of the trial court dismissing the cause of action and said that if the defendants knew their dinner guest was ill, it was for the jury to decide whether they were negligent in refusing his request to spend the night and, propping him on his wagon with the reins thrown over his shoulder, sending him toward home.

The Sixth Circuit Court of Appeals, in Hutchinson v. Dickie, 162 F.2d 103, 106 (C.A. 6, 1947), said that a host had an affirmative duty to attempt to rescue a guest who had fallen off his yacht. The host controlled the only instrumentality of rescue. The Court declared that to ask of the host anything less than that he attempt to rescue his guest would be 'so shocking to humanitarian considerations and the commonly accepted code of social conduct that the courts in similar situations have had no difficulty in pronouncing it to be a legal obligation.'

Farwell and Siegrist were companions on a social venture. Implicit in such a common undertaking is the understanding that one will render assistance to the other when he is in peril if he can do so without endangering himself. Siegrist knew or should have known when he left Farwell, who was badly beaten and unconscious, in the back seat of his car that no one would find him before morning. Under these circumstances, to say that Siegrist had no duty to obtain medical assistance or at least to notify someone of Farwell's condition and whereabouts would be 'shocking to humanitarian considerations' and fly in the face [396 Mich. 292] of 'the commonly accepted code of social conduct.'^[7] '(C)ourts will find a duty where, in general, reasonable men would recognize it and agree that it exists.'^[8]

Farwell and Siegrist were companions engaged in a common undertaking; there was a special relationship between the parties. Because Siegrist knew or should have known of the peril Farwell was in and could render assistance without endangering himself he had an affirmative duty to come to Farwell's aid.

The Court of Appeals is reversed and the verdict of the jury reinstated.

T. G. KAVANAGH, C.J., and WILLIAMS, J., concur.

LINDEMER and RYAN, JJ., not participating.

FITZGERALD, Justice (dissenting).

The unfortunate death of Richard Farwell prompted this wrongful death action brought by his father against defendant, David Siegrist, a friend who had accompanied Farwell during the evening in which the decedent received injuries which ultimately cause his death three days later. The question before us is whether the defendant, considering his relationship with the decedent and the activity they jointly experienced on the evening of August 26--27, 1966, by his conduct voluntarily or otherwise assumed, or should have assumed, the duty of rendering medical or other assistance to the deceased. We find that defendant had no obligation to assume, nor did he assume, such a duty.

[396 Mich. 293] The facts of the case are accurately set forth in the Court of Appeals opinion.

'Factually, it appears that, on August 26, 1966, Richard Murray Farwell, deceased eighteen-year-old son of the plaintiff, visited the home of his friend, David Siegrist, a sixteen-year-old; that evening they drove to a trailer rental lot, where Siegrist was returning an automobile he had borrowed from a friend who was employed by the rental agency.

'Siegrist and Farwell planned to wait in the car until the friend had finished work and then 'drive around,' stopping at various restaurants and drive-ins. While [240 N.W.2d 223] they were waiting, Seigrist estimated that they consumed 'four or five' beers each.

'Shortly before nine o'clock p.m., two teenage girls walked past the car. After an unsuccessful attempt to engage them in conversation, Farwell left the car and followed the girls; Siegrist got out of the car and followed Farwell.

'When the girls reached a restaurant a short distance down the street, they apparently complained to those present that they were being followed. Defendants Ingland, Brock, Donald Keaton, Daniel Keaton, and at least two others in the restaurant began to chase Farwell and Siegrist, both of whom ran back to the trailer lot.

'Siegrist escaped by ducking into the trailer rental office, where he requested those inside to assist Farwell. They stepped out of the office and were confronted by the group which had been chasing Siegrist and Farwell. The two groups faced each other, but no violence ensued, and the two groups scattered.

'It was then discovered for the first time that Farwell had been caught and beaten by those who had been pursuing him and Siegrist; Farwell was found underneath his automobile in the lot.

'Farwell was taken to the trailer rental office, where Siegrist gave him a plastic bag full of ice for his injuries. Shortly thereafter, Farwell and Siegrist left the rental office and, between ten o'clock p.m. and midnight, they visited four different drive-in restaurants. [396 Mich. 294] While enroute from the third to the fourth restaurant, Farwell stated that he wanted to lie down, climbed into the back seat, and went to sleep. Around midnight, Siegrist drove the car to the home of Farwell's grandparents, parked it in the driveway, and attempted to rouse Farwell. When the latter merely made a sound as if 'in a deep sleep', Siegrist left with a friend who had followed him to the grandparents' house. The next morning, Farwell was found by his grandparents, apparently taken to a hospital, and died of an epidural hematoma.

'At the close of plaintiff's proofs, defendant Siegrist moved for a directed verdict on the grounds that he had no duty to obtain medical assistance for Farwell as a matter of law. In the alternative, the motion was based upon the proposition that plaintiff failed to establish that any conduct on the part of Siegrist proximately caused Farwell's death. The motion was denied.' 51 Mich.App. 585, 587-588, 215 N.W.2d 753, 754.

Following the jury verdict of $15,000 in favor of the plaintiff, defendant, arguing that the verdict was inconsistent with the weight of the evidence, moved for and was denied a judgment notwithstanding the verdict. The decision of the trial court was reversed by the Court of Appeals which found that the defendant never assumed, voluntarily or otherwise, the duty of obtaining medical assistance for the deceased. The Court stated that the facts in no way indicated that defendant knew, or should have known, that immediate medical attention was required. Consequently, as a matter of law the Court determined that defendant was under no duty to obtain medical treatment for the decedent.

Plaintiff argues that once having voluntarily undertaken the duty of caring for decedent, defendant could not discontinue such assistance if, in so doing, he left the decedent in a worse position than when such duty was assumed. Defendant's [396 Mich. 295] knowledge of the seriousness of decedent's injury and the failure to advise decedent's grandparents, the close personal relationship that existed between defendant and the decedent, and the supposition that the decedent relied upon defendant for assistance leads plaintiff to conclude that defendant did not act 'with the reasonable prudence and care of a reasonable man in the same or like circumstances'. Defendant's position is that there was no volunteered assumption of duty to care for the safety of the decedent. He argues that the facts within his knowledge on the evening of August 26, 1966, and the evidence introduced at trial failed to establish that defendant should have seen that Richard Farwell [240 N.W.2d 224] had suffered a potentially fatal injury requiring immediate attention.

Defendant did not voluntarily assume the duty of caring for the decedent's safety. Nor did the circumstances which existed on the evening of August 26, 1966, impose such a duty. Testimony revealed that only a qualified physician would have reason to suspect that Farwell had suffered an injury which required immediate medical attention. The decedent never complained of pain and, in fact, had expressed a desire to retaliate against his attackers. Defendant's inability to arouse the decedent upon arriving at his grandparents' home does not permit us to infer, as does plaintiff, that defendant knew or should have known that the deceased was seriously injured.^[1] [396 Mich. 296] While it might have been more prudent for the defendant to insure that the decedent was safely in the house prior to leaving, we cannot say that defendant acted unreasonably in permitting Farwell to spend the night asleep^[2] in the back seat of his car.

The close relationship between defendant and the decedent is said to establish a legal duty upon defendant to obtain assistance for the decedent. No authority is cited for this proposition other than the public policy observation that the interest of society would be benefited if its members were required to assist one another. This is not the appropriate case to establish a standard of conduct requiring one to legally assume the duty of insuring the safety of another. Recognizing that legal commentaries have expressed moral outrage at those decisions^[3] which permit one to refuse aid to another whose life may be in peril, we cannot say that, considering the relationship between these two parties and the existing circumstances, defendant acted in an unreasonable manner.^[4]

[396 Mich. 297] Plaintiff believes that a legal duty to aid others should exist where such assistance greatly benefits society and only a reasonable burden is imposed upon those in a position to help. He contends further that the determination of the existence of a duty must rest with the jury where questions of foreseeability and the relationship of the parties are primary considerations.

It is clear that defendant's nonfeasance, or the 'passive inaction or a failure to take steps to protect (the decedent) from harm'^[5] is urged as being the proximate cause of Farwell's death. We must reject plaintiff's proposition which elevates a moral obligation to the level of a legal duty where, as here, the facts within defendant's knowledge in no way indicated that immediate medical attention was necessary and the [240 N.W.2d 225] relationship between the parties imposes no affirmative duty to render assistance. See Steckman v. Silver Moon, Inc., 77 S.D. 206, 90 N.W.2d 170, 64 A.L.R.2d 1171 (1958). The posture of this case does not permit us to create a legal duty upon one to render assistance to another injured or imperiled party where the initial injury was not caused by the person upon whom the duty is sought to be imposed.

The relationship of the parties and the question of foreseeability does not require that the jury, rather than the court, determine whether a legal duty exists. We are in agreement with the general principle advanced by plaintiff that the question of negligence is one of law for the court only when the facts are such that all reasonable men must draw the same conclusion.^[6] However, this principle becomes operative only after the court establishes [396 Mich. 298] that a legal duty is owed by one party to another. Prosser's analysis of the role of the court and jury on questions of legal duty, recently quoted in Moning v. Alfono, Mich. (1975), bears repeating:

'The existence of a duty. In other words, whether, upon the facts in evidence, such a relation exists between the parties that the community will impose a legal obligation upon one for the benefit of the other--or, more simply, whether the interest of the plaintiff which has suffered invasion was entitled to legal protection at the hands of the defendant. This is entirely a question of law, to be determined by reference to the body of statutes, rules, principles and precedents which make up the law; and it must be determined only by the court. * * * A decision by the court that, upon any version of the facts, there is no duty, must necessarily result in judgment for the defendant.' Prosser, Torts (4th ed.), § 37, p. 206.

Michigan recognizes that the question of duty is to be resolved by the court rather than the jury. Fischer v. Johnson Milk Co., Inc., 383 Mich. 158, 174 N.W.2d 752 (1970).

The Court of Appeals properly decided as a matter of law that defendant owed no duty to the deceased.

We would affirm.

COLEMAN, J., concurs.

[1] The trial judge instructed the jury to determine whether Siegrist had voluntarily undertaken to render aid and, if he had, whether he acted reasonably in discharging that duty. Whether Siegrist be charged with the duty of a voluntary rescuer or the duty of a companion, the standard of care--whether he acted reasonably under all the circumstances--is the same and the instruction given was adequate.

[2] Of course, merely labeling a question as one of 'law' or 'fact' does not solve the dilemma.

'No two terms of legal science have rendered better service than 'law' and 'fact' * * *. They readily accommodate themselves to any meaning we desire to give them * * *. What judge has not found refuge in them? The man who could succeed in defining them would be a public enemy.' Green, Judge and Jury, p. 270.

[3] '* * * The law has persistently refused to recognize the moral obligation of common decency and common humanity, to come to the aid of another human being who is in danger * * *. The remedy in such cases is left to the 'higher law' and the 'voice of conscience,' which, in a wicked world, would seem to be singularly ineffective either to prevent the harm or to compensate the victim.' Prosser, Torts (4th ed.), § 56, pp. 340--341.

'At the other end of the spectrum are cases where the peril to the plaintiff has come from a source in no way connected with defendant's conduct or enterprises or undertakings, past or present, but where the defendant has it in his power by taking some reasonable precaution to remove the peril. Here the law has traditionally found no duty, however reprehensible and unreasonable the defendant's failure to take the precaution may be. * * * There is no legal obligation to be a Good Samaritan.' Harper & James, The Law of Torts, § 18.6, p. 1046.

[4] Carriers have a duty to aid passengers who are known to be in peril (Yu v. New York, N.H. & H.R. Co., 145 Conn. 451, 144 A.2d 56 (1958)); employers similarly are required to render aid to employees (Anderson v. Atchison, T. & S.F.R. Co., 333 U.S. 821, 68 S.Ct. 854, 92 L.Ed. 1108 (1948); Bessemer Land & Improvement Co. v. Campbell, 121 Ala. 50, 25 So. 793 (1898); Carey v. Davis, 190 Iowa 720, 180 N.W. 889 (1921)); innkeepers to their guests (West v. Spratling, 204 Ala. 478, 86 So. 32 (1920)); a jailer to his prisoner (Farmer v. State, 224 Miss. 96, 79 So.2d 528 (1955)).

Maritime law has imposed a duty upon masters to rescue crewmen who fall overboard. Harris v. Pennsylvania R. Co., 50 F.2d 866 (C.A. 4, 1931).

See Prosser, Torts, Supra; Harper & James, Supra, pp. 1048-1049.

[5] In the following cases the court specifically mentions not only the defendant's knowledge of but also his apparent indifference toward the other person's peril: Southern R. Co. v. Sewell, 18 Ga.App. 544, 90 S.E. 94 (1916); Adams v. Chicago G.W.R. Co., 156 Iowa 31, 135 N.W. 21 (1912); Cincinnati, N.O. & T.P.R. Co. v. Marrs' Administratrix, 119 Ky. 954, 85 S.W. 188 (1905); Fagg's Administrator v. Louisville & N.R. Co., 111 Ky. 30, 63 S.W. 580 (1901); Depue v. Faltau, 100 Minn. 299, 111 N.W. 1 (1907); Whitesides v. Southern R. Co., 128 N.C. 229, 38 S.E. 878 (1901).

[6] Prosser, Supra, p. 343.

[7] Hutchinson v. Dickie, 162 F.2d 103, 106 (C.A. 6, 1947).

[8] Prosser, Supra, § 53, p. 327.

__________

[1] It is at this point--plaintiff's unsuccessful attempt to arouse the decedent in the driveway--that counsel, during oral argument, believes that defendant volunteered to aid the decedent. Yet no affirmative act by defendant indicated that he assumed the responsibility of rendering assistance to the decedent. Consequently, there could be no Discontinuance of aid or protection which left decedent in a worse position than when the alleged 'volunteering' occurred. This would make operative the concession of plaintiff that where no duty is owed, the refusal to act cannot form the basis for an action in negligence.

[2] Defendant had no way of knowing that it was the severity of the head injury suffered by the decedent which caused him to crawl in the back seat and apparently fall asleep. The altercation combined with the consumption of several beers could easily permit defendant to conclude that decedent was simply weary and desired to rest.

[3] The most notable of which include: Osterlind v. Hill, 263 Mass. 73, 160 N.E. 301, 56 A.L.R. 1123 (1928); Yania v. Bigan, 397 Pa. 316, 155 A.2d 343 (1959); and Hndiboe v. McCarthy, 114 Ga.App. 541, 151 S.E.2d 905 (1966).

[4] Were a special relationship to be the basis of imposing a legal duty upon one to insure the safety of another, it would most probably take the form of 'co-adventurers' who embark upon a hazardous undertaking with the understanding that each is mutually dependent upon the other for his own safety. There is no evidence to support plaintiff's position that decedent relied upon defendant to provide any assistance whatsoever. A situation where two persons are involved in an altercation provoked by the party ultimately injured, the extent of which was unknown to the other, whose subsequent conduct included drinking beer and a desire to retaliate against his attackers would not fall within this category.

[5] Prosser, Torts (4th ed.), § 56, pp. 338--339.

[6] McCullough v. Ward Trucking Co., 368 Mich. 108, 117 N.W.2d 167 (1962); Barnbee v. Spence Brothers, 367 Mich. 46, 116 N.W.2d 49 (1962).

[60 Cal.Rptr.2d 265] [14 Cal.4th 1069] [929 P.2d 584] Scott Righthand, San Francisco, for Plaintiff and Appellant.

Robert J. Rosati, Myers & Overstreet, Gregory L. Myers, Fresno, Sabrina Simmons-Brill, Agoura Hills, C. Michael Carrigan, Fresno and Lori R. Mayfield for Defendants and Respondents.

[14 Cal.4th 1070] Sonnenschein, Nath & Rosenthal, Lee T. Paterson, Los Angeles, Paul, Hastings, Janofsky & Walker, Paul Grossman, Paul W. Cane, Jr., and George W. Abele, Los Angeles, as amici curiae on behalf of Defendants and Respondents.

CHIN, Associate Justice.

In this case, we must decide under what circumstances courts may impose tort liability on employers who fail to use reasonable care in recommending former employees for employment without disclosing material information bearing on their fitness. Specifically, we are concerned with letters of recommendation that defendant school district officers allegedly wrote to a college placement service on behalf of Robert Gadams, an administrative employee they formerly employed. Plaintiff and appellant Randi W. claims that defendants unreservedly recommended Gadams for employment without disclosing to the placement service (and thus to prospective employers) facts defendants knew regarding prior charges or complaints of sexual misconduct and impropriety leveled against Gadams. Defendants' letters allegedly induced another school district to hire Gadams, who later sexually assaulted plaintiff, a student in that district.

As will appear, consistent with the Court of Appeal judgment in this case, we conclude that defendants' letters of recommendation, containing unreserved and unconditional praise for former employee Gadams despite defendants' alleged knowledge of complaints or charges of his sexual misconduct with students, constituted misleading statements that could form the basis for tort liability for fraud or negligent misrepresentation. Although policy considerations dictate that ordinarily a recommending employer should not be held accountable to third persons for failing to disclose negative information regarding a former employee, nonetheless liability may be imposed if, as alleged here, the recommendation letter amounts to an affirmative misrepresentation presenting a foreseeable and substantial risk of physical harm to a third person.

We also conclude, contrary to the Court of Appeal judgment in this case, that defendants' alleged failure to report the charges of Gadams's improper activities to the appropriate authorities pursuant to state statutory law fails to afford an alternate basis for tort liability in this case, and that the trial court properly sustained defendants' demurrers to the count in the complaint relying on this theory of liability.

We take the following uncontradicted statement of the procedural history of the case in large part from the Court of Appeal majority opinion.

[14 Cal.4th 1071] I. PROCEDURAL HISTORY

Plaintiff and appellant Randi W. (through her guardian ad litem, Marilyn E.W.) filed this lawsuit against Livingston Union School District, Muroc Joint Unified School District, [929 P.2d 585] Golden Plains Unified School District, Tranquility Elementary School, Mendota Unified School District, the State of California, Robert Gadams, Gilbert Rossette, Gary Rice, Richard Cole, Henry Escobar, Kathy Berkeley, and David Malcolm.

Defendants Livingston Union School District (Livingston), Robert Gadams, Henry Escobar, and Kathy Berkeley are not parties to this appeal. Accordingly, we use the term [60 Cal.Rptr.2d 266] "defendants" to refer to all remaining defendants in the case.

A. The Complaint

Plaintiff's first amended complaint (the complaint) alleged that she was a student at Livingston Middle School, where Gadams served as vice principal. On February 1, 1992, while plaintiff was in Gadams's office, he "negligently and offensively touched, molested, and engaged in sexual touching of 13-year old [plaintiff] proximately causing injury to her."

1. Count One: Negligence

The negligence count of the complaint alleges that all defendants knew or had reason to know that Gadams had previously engaged in various types of "sexual wrongdoing" with minors and students, but that defendants "negligently, carelessly, and/or with knowledge intentionally, maliciously, and/or fraudulently hired, retained, failed to report, failed to discipline, failed to supervise and/or affirmatively recommended defendant ROBERT GADAMS to other positions of trust and positions whereby he would act as an authority figure to minors and students."

The complaint makes specific negligence allegations as to each defendant. It alleges that Gadams worked in the Mendota Unified School District (Mendota) from 1985 to 1988. In May 1990, Gilbert Rossette, a Mendota official, provided to the placement office at Fresno Pacific College (where Gadams received his teaching credentials) a "detailed recommendation" regarding Gadams, knowing that it would be passed on to prospective employers, although Rossette allegedly knew of Gadams's prior improper contacts with female students. These contacts included hugging some female junior high school students, giving them back massages, making "sexual remarks" to them, and being involved in "sexual situations" with them. [14 Cal.4th 1072] Rossette's recommendation noted numerous positive aspects of Gadams's tenure in Mendota, including his "genuine concern" for students and his "outstanding rapport" with everyone, and concluded, "I wouldn't hesitate to recommend Mr. Gadams for any position!"

The complaint makes similar allegations regarding Richard Cole, an official of Tranquility High School District and Golden Plains Unified School District (Golden Plains), where Gadams was employed between 1986 or 1987 and 1990. The complaint alleges that in 1990, Cole provided Fresno Pacific College's placement office with a "detailed recommendation" of Gadams, although he knew of Gadams's prior inappropriate conduct while an employee of Golden Plains. Specifically, Cole knew that Gadams had been the subject of various parents' complaints, including charges that he "led a panty raid, made sexual overtures to students, sexual remarks to students...." These complaints had allegedly led to Gadams's "resigning under pressure from Golden Plains due to sexual misconduct charges...." Cole's recommendation listed Gadams's various favorable qualities as an instructor and administrator, and stated Cole "would recommend him for almost any administrative position he wishes to pursue."

Gary Rice and David J. Malcolm, officials in the Muroc Joint Unified School District (Muroc), where Gadams was employed in or around 1990 or 1991, also allegedly provided a "detailed recommendation" to Fresno Pacific College's placement office in 1991, despite their knowledge of disciplinary actions taken against Gadams regarding sexual harassment allegations made during his employment with Muroc. The allegations included charges of "sexual touching" of female students and induced Muroc to force Gadams to resign. The recommendation, signed by Malcolm, described Gadams as "an upbeat, enthusiastic administrator who relates well to the students" and who was "in a large part" responsible for making the campus of Boron Junior/Senior High School "a safe, orderly and clean environment for students and staff." Malcolm concluded by recommending Gadams "for an assistant principalship or equivalent position without reservation."

[929 P.2d 586] Defendants made these recommendations on forms that Fresno Pacific College supplied, which clearly stated that the information provided "will be sent to prospective employers."

Plaintiff contends that these recommendations, with their associated failures to disclose and to warn, were made "with actual malice, corruption and actual fraud since [60 Cal.Rptr.2d 267] these defendants knew the true facts regarding Gadams and knew that an injury to a child by Gadams would probably result." Plaintiff alleges that her injuries were a proximate result of defendants' actions.

[14 Cal.4th 1073] 2. Count Two: Negligent Hiring

Plaintiff alleges that each defendant was negligent in hiring Gadams "without any significant investigation or knowledge that Gadams was fit to act in a position of trust with respect to children or with complete indifference" to Gadams's history of sexual misconduct. She alleges that her injuries were a direct and proximate result of defendants' failures to investigate Gadams.

3. Count Three: Negligent Misrepresentation

Plaintiff alleges that defendants "negligently and carelessly failed to warn and failed to disclose the true facts" as previously alleged; that their gratuitous recommendations of Gadams to Fresno Pacific College's placement office were made with "actual fraud, corruption, and actual malice"; and that they knew those representations were false, and knew that "minor public school children generally and those at Livingston would probably suffer injury because of the representations and failure to warn." Plaintiff alleges that defendants owed a duty "to those to whom the statements were made and to the children at public schools whose families rely upon said representations."

4. Count Four: Fraud

Plaintiff alleges that defendants intentionally made those knowingly false representations about Gadams with knowledge that they were "likely to injure plaintiff," and with the intent that they would be relied upon "by all other defendants and others, and in fact were relied upon by each other defendant and plaintiff."

5. Count Five: Negligence Per Se

Plaintiff alleges that defendants had a mandatory duty under Penal Code section 11165 et seq. and other statutes to report the charges of Gadams's prior sexual misconduct "to appropriate authorities and to prospective employers." Defendants' failure to do so afforded Gadams "the opportunity to maintain a position of trust and authority with regard to minor students thereby enabling his molest of plaintiff."

6. Count Six: Title IX Violation

Finally, plaintiff alleges that she "has been the subject of sexual harassment by defendants," a violation of federal law. (See 20 U.S.C. §§ 1681-1688.)

[14 Cal.4th 1074] B. The Demurrers

Defendants demurred, arguing that each cause of action failed as a matter of law because the facts alleged failed to establish defendants owed any duty to plaintiff. At the hearing, the trial court expressed doubt whether plaintiff could adequately plead any duty running from defendants to her. The court further noted that, but for sustaining the demurrer on that basis, it would have sustained the demurrer with leave to amend for failure adequately to plead causation and reliance.

The court's later written order sustained defendants' demurrers without leave to amend because "... the First Amended Complaint does not state facts sufficient to constitute a cause of action against the demurring defendants, on the basis that no duty exists to this plaintiff, from these demurring defendants." The court entered judgment of dismissal with prejudice in favor of defendants, and this appeal followed.

C. The Court of Appeal Opinion

The Court of Appeal majority affirmed the trial court's ruling as to the general negligence, negligent hiring, and title IX counts, but reversed as to the negligent misrepresentation, fraud, and negligence per se counts. On the affirmed counts, the court [929 P.2d 587] reasoned that (1) the absence of allegations indicating defendants had the ability to control Gadams, or had a "special relationship" with him, negated general negligence liability (count one); (2) the fact that defendants did not employ Gadams when he allegedly injured plaintiff precluded liability under a negligent hiring theory (count two); and (3) [60 Cal.Rptr.2d 268] the lack of a direct relationship between plaintiff and defendants precluded liability for sexual harassment under title IX (count six). Plaintiff did not seek our review of those rulings, and we do not address them here.

As for the reversed counts, the Court of Appeal first ruled that plaintiff's complaint adequately stated a cause of action for fraud and negligent misrepresentation. The majority relied primarily on sections 310 and 311 of the Restatement Second of Torts, imposing liability on one who intentionally or negligently gives false information to another person that results in physical injury to the recipient or a third person. The majority believed that defendants' letters contained misleading representations or "half-truths" regarding Gadams's qualifications. The Court of Appeal dissent concluded that because the letters contained no statements regarding Gadams's sexual contacts with students, but referred only to "positive" aspects of his character and qualifications, the letters contained no actionable misrepresentations.

The Court of Appeal majority also ruled that the complaint stated a cause of action for negligence per se, because defendants allegedly breached their [14 Cal.4th 1075] statutory duty under the Child Abuse and Neglect Reporting Act (Pen.Code, § 11164 et seq.) (the Reporting Act) to report to the authorities the various charges of sexual misconduct involving Gadams. The majority concluded the complaint adequately alleged that defendants' knowledge or suspicion that Gadams had committed sexual abuse invoked the provisions of the Reporting Act.

The Court of Appeal dissent disagreed, concluding that defendants had no duty under the Reporting Act to report gossip or hearsay regarding a school officer's improper conduct.

II. DISCUSSION

A. Fraud and Negligent Misrepresentation

Our task on reviewing an order sustaining a demurrer without leave to amend "is to determine whether the complaint states a cause of action. Accordingly, we assume that the complaint's properly pleaded material allegations are true and give the complaint a reasonable interpretation by reading it as a whole and all its parts in their context." (Garcia v. Superior Court (1990) 50 Cal.3d 728, 732, 268 Cal.Rptr. 779, 789 P.2d 960 (Garcia ).)

In finding plaintiff's complaint stated a cause of action against defendants for fraud and negligent misrepresentation, the Court of Appeal majority relied primarily on sections 310 and 311 of the Restatement Second of Torts. Section 310 involves intentional conduct and provides that "[a]n actor who makes a misrepresentation is subject to liability to another for physical harm which results from an act done by the other or a third person in reliance upon the truth of the representation, if the actor [p] (a) intends his statement to induce or should realize that it is likely to induce action by the other, or a third person, which involves an unreasonable risk of physical harm to the other, and [p] (b) knows [p] (i) that the statement is false, or [p] (ii) that he has not the knowledge which he professes." (Italics added.)

Section 311 of the Restatement Second of Torts, involving negligent conduct, provides that: "(1) One who negligently gives false information to another is subject to liability for physical harm caused by action taken by the other in reasonable reliance upon such information, where such harm results [p] (a) to the other, or [p] (b) to such third persons as the actor should expect to be put in peril by the action taken. [p] (2) Such negligence may consist of failure to exercise reasonable care [p] (a) in ascertaining the accuracy of the information, or [p] (b) in the manner in which it is communicated." (Italics added.)

[14 Cal.4th 1076] Although ordinarily a duty of care analysis is unnecessary in determining liability for intentional misrepresentation or fraud (see 5 Witkin, Summary of Cal. Law (9th ed. 1988) Torts, § 676, p. 778, and cases cited), here we consider liability to a third person injured as [929 P.2d 588] a result of the alleged fraud, an extension of ordinary tort liability based on fraud. (See Civ.Code, § 1709.) Accordingly, in deciding whether to adopt the two Restatement provisions in the circumstances of this case, we consider whether plaintiff has [60 Cal.Rptr.2d 269] sufficiently pleaded that defendants owed her a duty of care, that they breached that duty by making misrepresentations or giving false information, and that Livingston's reasonable reliance on their statements proximately caused plaintiff's injury. (See Garcia, supra, 50 Cal.3d at pp. 734-738, 268 Cal.Rptr. 779, 789 P.2d 960 [discussing these elements in context of Rest.2d Torts, § 311].) We examine each element separately.

1. Duty to Plaintiff

Did defendants owe plaintiff a duty of care? In defendants' view, absent some special relationship between the parties, or some specific and known threat of harm to plaintiff, defendants had no duty of care toward her, and no obligation to disclose in their letters any facts regarding the charges against Gadams. (See Rest.2d Torts, § 315 [generally no duty to warn those threatened by third person's conduct]; Peterson v. San Francisco Community College Dist. (1984) 36 Cal.3d 799, 806, 205 Cal.Rptr. 842, 685 P.2d 1193 [same]; Thompson v. County of Alameda (1980) 27 Cal.3d 741, 758, 167 Cal.Rptr. 70, 614 P.2d 728 [duty to warn "readily identifiable" victim]; Tarasoff v. Regents of University of California (1976) 17 Cal.3d 425, 433-435, 131 Cal.Rptr. 14, 551 P.2d 334 ["special relationship" creates duty to warn or control another's conduct]; cf. Foley v. Interactive Data Corp. (1988) 47 Cal.3d 654, 692-693, 254 Cal.Rptr. 211, 765 P.2d 373 [declining to extend "special relationship" test to employer-employee relationship].)

Plaintiff does not argue that a special relationship existed between defendants and her or Gadams. Instead, she relies on Garcia, supra, 50 Cal.3d at pages 735-736, 268 Cal.Rptr. 779, 789 P.2d 960, where we held that, under section 311 of the Restatement Second of Torts, a parole officer had a duty to exercise reasonable care in giving the victim information regarding the parolee who ultimately killed her. We noted that although the parole officer had no duty to volunteer information regarding the released criminals he supervised, "... the absence of a duty to speak does not entitle one to speak falsely." (Garcia, supra, 50 Cal.3d at p. 736, 268 Cal.Rptr. 779, 789 P.2d 960.) We concluded that the parole officer, "having chosen to communicate information about [the parolee] to [the victim], had a duty to use reasonable care in doing so," and that the officer either knew or [14 Cal.4th 1077] should have known that the victim's safety might depend on the accuracy of the information imparted. (Ibid., citing Rest.2d Torts, § 311, com. b, p. 106.)

Plaintiff acknowledges that Garcia is distinguishable, and that no California case has yet held that one who intentionally or negligently provides false information to another owes a duty of care to a third person who did not receive the information and who has no special relationship with the provider. Accordingly, the issue before us is one of first impression, and we apply the general analytical principles used to determine the existence of duty in particular cases.

In this state, the general rule is that all persons have a duty to use ordinary care to prevent others from being injured as the result of their conduct. (Rowland v. Christian (1968) 69 Cal.2d 108, 112, 70 Cal.Rptr. 97, 443 P.2d 561, 32 A.L.R.3d 496; see Civ.Code, § 1714.) As we have observed, "Rowland enumerates a number of considerations ... that have been taken into account by courts in various contexts to determine whether a departure from the general rule is appropriate: 'the major [considerations] are the foreseeability of harm to the plaintiff, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury suffered, the moral blame attached to the defendant's conduct, the policy of preventing future harm, the extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with resulting liability for breach, and the availability, cost, and prevalence of insurance for the risk involved.' (Italics added.) (69 Cal.2d at p. 113, 70 Cal.Rptr. 97, 443 P.2d 561.) The foreseeability of a particular kind of harm plays a very significant role in this calculus [citation], but a court's task--in determining 'duty'--is not to decide whether a particular [929 P.2d 589] plaintiff's injury was reasonably foreseeable in light of a particular defendant's conduct, but rather to evaluate more generally whether the category of negligent conduct at issue [60 Cal.Rptr.2d 270] is sufficiently likely to result in the kind of harm experienced that liability may appropriately be imposed on the negligent party." (Ballard v. Uribe (1986) 41 Cal.3d 564, 572-573, fn. 6, 224 Cal.Rptr. 664, 715 P.2d 624.)

a. Foreseeability and causality

Applying these factors here, we first examine whether plaintiff's injuries were a foreseeable result of defendants' representations regarding Gadams's qualifications and character, coupled with their failure to disclose to the Fresno Pacific College placement office information regarding charges or complaints of Gadams's sexual misconduct. Could defendants reasonably have foreseen that the representations and omissions in their reference letters would result in physical injury to someone? Although the chain of causation [14 Cal.4th 1078] leading from defendants' statements and omissions to Gadams's alleged assault on plaintiff is somewhat attenuated, we think the assault was reasonably foreseeable. Based on the facts alleged in the complaint, defendants could foresee that Livingston's officers would read and rely on defendants' letters in deciding to hire Gadams. Likewise, defendants could foresee that, had they not unqualifiedly recommended Gadams, Livingston would not have hired him. And, finally, defendants could foresee that Gadams, after being hired by Livingston, might molest or injure a Livingston student such as plaintiff. We must assume, for purposes of demurrer, that plaintiff was indeed injured in the manner she alleges, and that a causal connection exists between defendants' conduct and the injury suffered. As plaintiff's complaint alleges, her injury was a "direct and proximate result" of defendants' fraud and misrepresentations.

b. Moral blame

Whether defendants were guilty of any moral blame would depend on the proof adduced at trial, although it is certainly arguable that their unreserved recommendations of Gadams, together with their failure to disclose facts reasonably necessary to avoid or minimize the risk of further child molestations or abuse, could be characterized as morally blameworthy.

c. Availability of insurance or alternative courses of conduct

Next, we may assume that standard business liability insurance is available to cover instances of negligent misrepresentation or nondisclosure as alleged in count three of the complaint, but is not available for the fraud or intentional misconduct alleged in count four. (See Ins.Code, § 533; Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 16-18, 44 Cal.Rptr.2d 370, 900 P.2d 619.) Perhaps more significantly, defendants had alternative courses of conduct to avoid tort liability, namely, (1) writing a "full disclosure" letter revealing all relevant facts regarding Gadams's background, or (2) writing a "no comment" letter omitting any affirmative representations regarding Gadams's qualifications, or merely verifying basic employment dates and details. The parties cite no case or Restatement provision suggesting that a former employer has an affirmative duty of disclosure that would preclude such a "no comment" letter. As we have previously indicated, liability may not be imposed for mere nondisclosure or other failure to act, at least in the absence of some special relationship not alleged here. (Garcia, supra, 50 Cal.3d at p. 734, 268 Cal.Rptr. 779, 789 P.2d 960; see Rest.2d Torts, § 315.)

d. Public policy considerations

As for public policy, the law certainly recognizes a policy of preventing future harm of the kind alleged here. One of society's highest [14 Cal.4th 1079] priorities is to protect children from sexual or physical abuse. (See, e.g., Barela v. Superior Court (1981) 30 Cal.3d 244, 254, 178 Cal.Rptr. 618, 636 P.2d 582 [duty of all citizens to protect children from sexual abuse]; Pen.Code, § 11166 [duty to report suspected child abuse].)

Defendants urge that competing social or economic policies may disfavor the imposition of liability for misrepresentation or nondisclosure in employment references. They observe that a rule imposing liability in these situations could greatly inhibit the preparation and distribution of reference letters, to [929 P.2d 590] the general detriment of employers and employees alike.

[60 Cal.Rptr.2d 271] We have recently stated that "[w]hen deciding whether to expand a tort duty of care, courts must consider the potential social and economic consequences. [Citations.]" (Macias v. State of California (1995) 10 Cal.4th 844, 859-860, 42 Cal.Rptr.2d 592, 897 P.2d 530; see Moore v. Regents of University of California (1990) 51 Cal.3d 120, 146, 271 Cal.Rptr. 146, 793 P.2d 479, 16 A.L.R.5th 903; Dillon v. Legg (1968) 68 Cal.2d 728, 734, 69 Cal.Rptr. 72, 441 P.2d 912, 29 A.L.R.2d 1316 ["duty" is expression of the total policy considerations leading to conclusion that plaintiff is entitled to protection].) Defendants argue that a rule imposing tort liability on writers of recommendation letters could have one very predictable consequence: employers would seldom write such letters, even in praise of exceptionally qualified employees.

In defendants' view, rather than prepare a recommendation letter stating all "material" facts, positive and negative, an employer would be better advised to decline to write a reference letter or, at most, merely to confirm the former employee's position, salary, and dates of employment. According to defendants, apart from the former employer's difficulty in deciding how much "negative" information to divulge, an employer who disclosed more than minimal employment data would risk a defamation, breach of privacy, or wrongful interference suit from a rejected job seeker. (See, e.g., Jensen v. Hewlett-Packard Co. (1993) 14 Cal.App.4th 958, 965, 18 Cal.Rptr.2d 83 [libel action may be based on false accusations in employee evaluation form of criminal conduct, dishonesty, incompetence, or reprehensible personal characteristics or behavior]; Marshall v. Brown (1983) 141 Cal.App.3d 408, 412, 190 Cal.Rptr. 392 [wrongful interference liability based on negative comments in former employer's evaluation letter]; see also Nelson v. Upsala College (3d Cir.1995) 51 F.3d 383, 387-388, and cases cited; Smolla, Law of Defamation (1995 ed.) § 15.01[a], p. 15-3, and cases cited ["Traditionally, defamation suits brought against former employers by disgruntled employees arise in the context of unfavorable reference letters or other communications to third parties concerning the employee's job performance [14 Cal.4th 1080] ...."]; Lab.Code, §§ 1050 [misdemeanor to misrepresent facts regarding former employee to prevent employee's further employment], 1054 [treble damages for misrepresenting employment facts].)

Defendants contend that the threat of potential tort liability will inhibit employers from freely providing reference information, restricting the flow of information prospective employers need and impeding job applicants in finding new employment. One writer recently explained that "[m]any employers have adopted policies, sometimes referred to as 'no comment' policies, under which they refuse to provide job references for former or departing employees.... [T]hese policies work to the detriment of both prospective employers and prospective employees." (Saxton, Flaws in the Laws Governing Employment References: Problems of "Overdeterence" and a Proposal for Reform (1995) 13 Yale L. & Pol'y Rev. 45; see also id. at pp. 46-52 [citing evidence of increasing use of "no comment" letters, and deploring resultant restriction on flow of information]; Note, Negligent Referral: A Potential Theory for Employer Liability (1991) 64 So.Cal.L.Rev. 1645 [observing that "[m]ore and more employers ... are refusing to provide employee references"]; Note, Employer Defamation: Reasons and Remedies for Declining References and Chilled Communications in the Workplace (1989) 40 Hastings L.J. 687, 688-690; Note, Defamation in the Workplace: The Impact of Increasing Employer Liability (1989) 72 Marq.L.Rev. 264, 265 & fn. 9, 275-276, 300-301.)

In response, plaintiff asserts it is unlikely that employers will decline to write reference letters for fear of tort liability, at least in situations involving no foreseeable risks of physical injury to someone. Plaintiff observes that an employer would be protected from a defamation suit by the statutory qualified privilege for nonmalicious communications regarding a job applicant's qualifications. (See Civ.Code, § 47, subd. (c).) This provision was amended in 1994 to provide that the qualified privilege available for communications to and by "interested" persons "applies to and includes a communication concerning the job performance or qualifications of an applicant for employment, based [60 Cal.Rptr.2d 272] [929 P.2d 591] upon credible evidence, made without malice, by a current or former employer of the applicant to, and upon request of, the prospective employer." (Civ.Code, § 47, subd. (c).) As plaintiff suggests, the existence of this privilege may encourage more open disclosure of relevant information regarding former employees. (See also Jensen v. Hewlett-Packard Co., supra, 14 Cal.App.4th at pp. 964-965, 18 Cal.Rptr.2d 83 [acknowledging public policy disfavoring libel suits based on comments in employee evaluation forms].)

We note that, although defendants have not argued the point, an amicus curiae has contended that the privilege under Civil Code section 47, subdivision (c), extends beyond defamation actions by former employees and [14 Cal.4th 1081] would provide a defense to plaintiff's misrepresentation action. As we have previously acknowledged, a similar qualified privilege for communications made in judicial proceedings (Civ.Code, § 47, subd. (b)(2)) applies to "virtually all torts except malicious prosecution. [Citations.]" (Kimmel v. Goland (1990) 51 Cal.3d 202, 209, 271 Cal.Rptr. 191, 793 P.2d 524.) Legislative materials submitted by this amicus curiae, however, indicate that Civil Code section 47, subdivision (c), was primarily intended to provide employers with a defense to actions by former employees, rather than to insulate them from all tort liability arising from employment disclosures.

Assuming arguendo that Civil Code section 47, subdivision (c), would afford a defense in negligent or intentional misrepresentation actions brought by injured third persons, by its terms the new privilege pertains only to communications made "upon request of" the prospective employer. Defendants do not claim that they wrote in response to Livingston 's request, and, accordingly, the privilege is inapplicable.

In light of these factors and policy considerations, we hold, consistent with Restatement Second of Torts sections 310 and 311, that the writer of a letter of recommendation owes to third persons a duty not to misrepresent the facts in describing the qualifications and character of a former employee, if making these misrepresentations would present a substantial, foreseeable risk of physical injury to the third persons. In the absence, however, of resulting physical injury, or some special relationship between the parties, the writer of a letter of recommendation should have no duty of care extending to third persons for misrepresentations made concerning former employees. In those cases, the policy favoring free and open communication with prospective employers should prevail.

Having concluded that defendants owed plaintiff a duty not to misrepresent Gadams's qualifications or character in their letters of recommendation, we next must determine whether defendants' letters indeed contained "misrepresentations" or "false information" within the meaning of Restatement Second of Torts section 310 or 311. If defendants made no misrepresentations, then as a matter of law they could not be found liable under those provisions.

2. Misleading Misrepresentation or Mere Nondisclosure?

The Court of Appeal majority determined that plaintiff adequately alleged defendants committed actual misrepresentation rather than mere nondisclosure, because their letters of recommendation amounted to "misleading [14 Cal.4th 1082] half-truths," containing incomplete information regarding Gadams's character and reliability. According to the Court of Appeal, defendants' unqualified recommendation of Gadams, coupled with their failure to disclose that Gadams had been in "sexual situations" with female students and had made "sexual overtures" to them, or that defendants knew complaints regarding Gadams's conduct had resulted in his resignation, amounted to affirmative misrepresentations.

Defendants join the Court of Appeal dissent in asserting that their letters of recommendation contained no misrepresentations that would invoke either Restatement Second of Torts section 310 or 311. As defendants observe, their letters neither discussed nor denied prior complaints of sexual misconduct or impropriety against Gadams.

[60 Cal.Rptr.2d 273] [929 P.2d 592] Like the Court of Appeal majority, we view this case as a "misleading half-truths" situation in which defendants, having undertaken to provide some information regarding Gadams's teaching credentials and character, were obliged to disclose all other facts which "materially qualify" the limited facts disclosed. (See, e.g., Warner Constr. Corp. v. City of Los Angeles (1970) 2 Cal.3d 285, 294, 85 Cal.Rptr. 444, 466 P.2d 996; Rogers v. Warden (1942) 20 Cal.2d 286, 289, 125 P.2d 7; Low v. Wheeler (1962) 207 Cal.App.2d 477, 484, 24 Cal.Rptr. 538; Civ.Code, § 1710, subd. 3 [deceit is the suppression of a material fact by one who gives misleading information of other facts]; 5 Witkin, Summary of Cal. Law, supra, Torts, § 703, at p. 805, and cases cited.)

As the Court of Appeal observed, defendants' letters offered general and unreserved praise for Gadams's character and personality (e.g., "dependable [and] reliable," "pleasant personality," "high standards," "relates well to the students"). According to the Court of Appeal, having volunteered this information, defendants were obliged to complete the picture by disclosing material facts regarding charges and complaints of Gadams's sexual improprieties.

Defendants suggest that a letter noting only a candidate's favorable qualities cannot reasonably be deemed misleading as to any unfavorable ones, and the recipient of such a letter cannot reasonably rely on any implication that the candidate lacks unfavorable qualities. (See Garcia, supra, 50 Cal.3d at p. 737, 268 Cal.Rptr. 779, 789 P.2d 960 [stressing necessity of proving recipient of false information reasonably relied on it as a prerequisite to liability under Rest.2d Torts, § 311].) As one commentator observes, "... half of the truth may obviously amount to a lie, if it is understood to be the whole." (Prosser & Keeton, The Law of Torts (5th ed. 1984) Misrepresentation and Nondisclosure, § 106, p. 738, italics added.) According to defendants, no reasonable [14 Cal.4th 1083] person would assume a letter of recommendation purports to state the whole truth about a candidate's background and character.

In defendants' view, we should characterize letters of recommendation stating only the favorable aspects of an applicant's background or character as a permissible variety of "half-truth," which misleads no one, and which, for that reason alone, should not form the basis for liability on a theory of negligent misrepresentation or fraud. (See Evan F. v. Hughson United Methodist Church (1992) 8 Cal.App.4th 828, 840-841, fn. 2, 10 Cal.Rptr.2d 748 [failure of church officers to disclose pastor's history of pedophilia not actionable in absence of affirmative representation denying that history, because "[t]he tort of negligent misrepresentation requires a 'positive assertion' and does not apply to implied misrepresentations"]; Weissich v. County of Marin (1990) 224 Cal.App.3d 1069, 1082-1083, 274 Cal.Rptr. 342 [county officers' failure to notify former district attorney of threats posed by vindictive probationer not actionable despite implied representation to warn]; Yanase v. Automobile Club of So. Cal. (1989) 212 Cal.App.3d 468, 473, 260 Cal.Rptr. 513 [auto club tourbook endorsing motel's accommodations contained no "positive assertion concerning neighborhood safety," precluding negligent misrepresentation suit]; Cohen v. Wales (1987) 133 A.D.2d 94 [518 N.Y.S.2d 633, 634] [failure to disclose sexual misconduct charges against former employee/teacher not actionable because "[t]he mere recommendation of a person for potential employment is not a proper basis for asserting a claim of negligence where another party is responsible for the actual hiring"]; Moore v. St. Joseph Nursing Home, Inc. (1990) 184 Mich.App. 766, 459 N.W.2d 100, 103; cf. Gutzan v. Altair Airlines, Inc. (3d Cir.1985) 766 F.2d 135, 137 [liability of employment agency based on positive misrepresentation that job seeker's innocent explanation for his rape conviction "had been verified by military officials"].)

But plaintiff argues convincingly that, under the facts pleaded in this case, defendants indeed made "positive assertion[s]" regarding Gadams's character, assertions deceptively incomplete because defendants knowingly concealed material facts regarding Gadams's sexual misconduct with students. Thus, defendant Mendota, through its officer Rossette, allegedly extolled Gadams's "genuine concern" for and "outstanding rapport" with [60 Cal.Rptr.2d 274] [929 P.2d 593] students, knowing that Gadams had engaged in inappropriate physical contact with them. Rossette declared in the letter that he "wouldn't hesitate to recommend Mr. Gadams for any position!"

Defendant Golden Plains, through its officer Cole, stated it would recommend Gadams for "any administrative position," despite its knowledge of Gadams's prior inappropriate conduct while an employee of Golden Plains, [14 Cal.4th 1084] conduct that had allegedly led to Gadams's "resigning under pressure from Golden Plains due to sexual misconduct charges...."

Finally, defendant Muroc, through its officers Rice and Malcolm, allegedly recommended Gadams "for an assistant principalship or equivalent position without reservation," describing Gadams as "an upbeat, enthusiastic administrator who relates well to the students," despite its knowledge of disciplinary actions taken against him regarding sexual harassment allegations made during his employment with Muroc, allegations that induced Muroc to force Gadams to resign.

We conclude that these letters, essentially recommending Gadams for any position without reservation or qualification, constituted affirmative representations that strongly implied Gadams was fit to interact appropriately and safely with female students. These representations were false and misleading in light of defendants' alleged knowledge of charges of Gadams's repeated sexual improprieties. We also conclude that plaintiff's complaint adequately alleged misleading half-truths that could invoke an exception to the general rule excluding liability for mere nondisclosure or other failure to act. (E.g., Garcia, supra, 50 Cal.3d at p. 734, 268 Cal.Rptr. 779, 789 P.2d 960.)

3. Reliance

Did plaintiff adequately plead the requisite element of reliance? Her complaint alleges that Livingston relied on defendants' letters in hiring Gadams, but the complaint is silent regarding plaintiff's own reliance on those letters. The Court of Appeal majority ruled that, even though defendants made no misrepresentations directly to plaintiff, who probably neither knew of, nor relied on, their statements, she was nonetheless entitled to protection in accordance with the Restatement principles previously discussed.

With respect to section 310 of the Restatement Second of Torts, the Court of Appeal concluded that, despite some imprecision of language, "... it is clear that the authors of the Restatement intended [section 310] to apply to cases in which third persons are endangered by the misrepresentation." This conclusion seems correct. Paraphrasing the section, here defendants allegedly made misrepresentations that resulted in physical harm to plaintiff by reason of an act done by Livingston (i.e., hiring Gadams) in reliance on the truth of the representations. Defendants intended or should have realized that their misrepresentations were likely to induce action by Livingston that involved an unreasonable risk of physical harm to plaintiff. (See Rest.2d Torts, § 310, com. c, pp. 104-105 ["A misrepresentation may be negligent [14 Cal.4th 1085] not only toward a person whose conduct it is intended to influence but also toward all others whom the maker should recognize as likely to be imperiled by action taken in reliance upon his misrepresentation"].)

As for section 311 of the Restatement Second of Torts, the Court of Appeal observed that our court has already adopted and applied that section, although in the different context of a misrepresentation made directly to the plaintiff, who relied on it and was physically harmed as a result. (See Garcia, supra, 50 Cal.3d at pp. 735-736, 268 Cal.Rptr. 779, 789 P.2d 960.)

Defendants in this case had contended on appeal that plaintiff failed to plead her own reliance on their letters, as required by the case law. (E.g., Mirkin v. Wasserman (1993) 5 Cal.4th 1082, 1088, 23 Cal.Rptr.2d 101, 858 P.2d 568 ["It is settled that a plaintiff, to state a cause of action for deceit based on a misrepresentation, must plead that he or she actually relied on the misrepresentation."]; id. at p. 1089, fn. 2, 23 Cal.Rptr.2d 101, 858 P.2d 568 and accompanying text; see Garcia, supra, 50 Cal.3d at p. 737, 268 Cal.Rptr. 779, 789 P.2d 960.) The Court of Appeal rejected the argument, observing [60 Cal.Rptr.2d 275] [929 P.2d 594] that "[t]hose cases all involved claims only for damages resulting from economic loss as opposed to damages based on physical injury.... [C]ases involving only economic loss are subject to a more restrictive rule. (Garcia v. Superior Court, supra, 50 Cal.3d at pp. 735-736, 268 Cal.Rptr. 779, 789 P.2d 960....)"

The Court of Appeal thus concluded that it was unnecessary under section 311 of the Restatement Second of Torts for plaintiff to plead her own reliance on defendants' misrepresentations, as long as the recipient of those misrepresentations (ultimately, Livingston) reasonably relied on them in hiring Gadams, as plaintiff alleged here. Citing a comment to section 311, the court observed that "The Restatement, however, makes it clear that the plaintiff need not rely on the misrepresentation and may, indeed, not even know that it was made. (See Rest.2d Torts, § 311, com. d, illus. 8, pp. 108-109.)" (See also Mirkin v. Wasserman, supra, 5 Cal.4th at pp. 1111-1114, 23 Cal.Rptr.2d 101, 858 P.2d 568 (conc. and dis. opn. of Kennard, J., [citing the principle of indirect reliance].)

We agree with the Court of Appeal's reliance analysis. Under the Restatement provisions, plaintiff need only allege that her injury resulted from action that the recipient of defendants' misrepresentations took in reliance on them. In a case involving false or fraudulent letters of recommendation sent to prospective employers regarding a potentially dangerous employee, it would be unusual for the person ultimately injured by the employee actually to "rely" on such letters, much less even be aware of them.

In any event, as the Court of Appeal observed, failure to plead reliance would not be a ground for sustaining a demurrer without leave to amend. We [14 Cal.4th 1086] note that questions concerning the reasonableness of Livingston's reliance on letters written well before Livingston allegedly received information regarding Gadams's misconduct are not before us in reviewing the trial court's ruling on demurrer.

4. Proximate Cause

As previously discussed, plaintiff's complaint alleges that her injury was a "proximate" result of defendants' fraud and misrepresentations. Defendants do not suggest that the complaint fails to state sufficient facts to establish proximate causation, assuming the remaining elements of duty, misrepresentation and reliance are sufficiently pleaded. Based on the facts alleged in the complaint, plaintiff's injury foreseeably and proximately resulted from Livingston's decision to hire Gadams in reliance on defendants' unqualified recommendation of him.

Thus, we conclude, consistent with the Court of Appeal majority, that the trial court improperly sustained demurrers to counts three and four of plaintiff's complaint without leave to amend.

B. The Negligence Per Se Count

As an alternative theory of liability, plaintiff charged defendants with negligence per se arising from breach of their statutory duty, as the Reporting Act requires, to report to the authorities the various incidents of sexual misconduct involving Gadams. Such a breach, if proved, would raise a presumption that defendants failed to exercise due care. (See Evid.Code, § 669, subd. (a); Landeros v. Flood (1976) 17 Cal.3d 399, 413-414, 131 Cal.Rptr. 69, 551 P.2d 389 [negligence per se liability arising from failure to comply with Reporting Act provision requiring reporting of child physical abuse].)

The Court of Appeal majority concluded that plaintiff's complaint stated a cause of action for negligence per se, based on defendants' alleged breach of their statutory duty. The Court of Appeal reasoned that the Reporting Act required defendants to report known or reasonably suspected incidents of "child abuse" to a "child protective agency" (which would include law enforcement agencies). (Pen.Code, § 11166, subd. (a).) The court believed plaintiff's complaint adequately pleaded that defendants knew acts of child abuse had occurred within the meaning of the Reporting Act.

The dissenting justice in the Court of Appeal concluded that plaintiff's complaint failed to state a cause of action for negligence per se because she [14 Cal.4th 1087] alleged insufficient facts to show defendants violated Penal Code [60 Cal.Rptr.2d 276] section [929 P.2d 595] 11166, the reporting provision. According to the dissent, plaintiff failed to allege that defendants knew or had observed any abused child, or that they knew of any actual physical or sexual assaults or exploitation, as defined in Penal Code section 11165.1.

We need not decide whether the complaint's allegations are sufficient to allege defendants knew or suspected reportable "child abuse," because it is clear plaintiff was not a member of the class for whose protection the Reporting Act was enacted. Defendant school districts were never the "custodians" of plaintiff, a Livingston student and, accordingly, owed her no obligations under the Act.

Evidence Code section 669 creates a presumption of negligence arising from violation of a statute, but only if "[t]he person suffering the ... injury ... was one of the class of persons for whose protection the statute ... was adopted." (Evid.Code, § 669, subd. (a)(4); see 6 Witkin, Summary of Cal. Law (9th ed. 1988) Torts, § 819, p. 172.) The duty to report under the Reporting Act (see Pen.Code, § 11166) applies to a "child care custodian" (which would include a school district) "who has knowledge of or observes a child, in his or her professional capacity or within the scope of his or her employment, whom he or she knows or reasonably suspects has been the victim of child abuse" (which includes sexual abuse). Reasonably construed, the act was intended to protect only those children in the custodial care of the person charged with reporting the abuse, and not all children who may at some future time be abused by the same offender. Plaintiff fails to allege that she was ever in defendants' custodial care, or even that defendants were aware that Gadams had molested her.

To adopt plaintiff's contrary argument would impose a broader reporting obligation than the Legislature intended. Under plaintiff's interpretation of the Reporting Act, a child care custodian that fails to report suspected child abuse affecting one child in its care or custody could be held liable, perhaps years later, to any other children abused by the same person, whether or not those children were within its custodial protection. Neither legislative intent nor public policy would support such a broad extension of liability.

III. CONCLUSION

The judgment of the Court of Appeal is affirmed as to counts three and four (negligent misrepresentation and fraud), but reversed as to count five (negligence per se). The cause is remanded with directions to reverse the trial court's order sustaining defendants' general demurrers to counts three and four, and to affirm that order as to all remaining counts.

[14 Cal.4th 1088] GEORGE, C.J., MOSK and BROWN, JJ., concurred.

KENNARD, Associate Justice, concurring and dissenting.

I concur with and join in the majority opinion with the exception of part II.B. (The Negligence Per Se Count) and that portion of part III (Conclusion) reversing the Court of Appeal's judgment as to count 5 (negligence per se) and directing the Court of Appeal to affirm the trial court's order sustaining defendant's general demurrer to count 5. Unlike the majority, I conclude that plaintiff has adequately pleaded a cause of action for negligence under the doctrine of negligence per se.

The theory of count 5 of plaintiff's complaint is that the three defendant school districts that formerly employed Robert Gadams, the vice principal who sexually molested plaintiff, violated the Child Abuse and Neglect Reporting Act (Pen.Code, § 11164 et seq.; hereafter the Reporting Act) by failing to report to the proper authorities Gadams's prior incidents of sexual misconduct with students, and that this statutory violation renders them liable under the doctrine of negligence per se for the damages she suffered as a result of her molestation by Gadams.

To plead a cause of action for negligence under the doctrine of negligence per se, a plaintiff must allege these elements: (1) the defendant violated a statute, ordinance, or regulation; (2) the violation proximately [60 Cal.Rptr.2d 277] [929 P.2d 596] caused death or injury to the plaintiff; (3) the death or injury resulted from an occurrence of the kind that the statute, ordinance, or regulation was designed to prevent; and (4) the plaintiff belonged to the class of persons for whose protection the statute, ordinance, or regulation was adopted. (Evid.Code, § 669, subd. (a).) Here, the majority concludes that count 5 of plaintiff's complaint fails to satisfy the last of these requirements because, as a matter of law, plaintiff does not belong to the class of persons for whose protection the Reporting Act was adopted. I disagree.

The Reporting Act states its legislative purpose: "The intent and purpose of this article is to protect children from abuse." (Pen.Code, § 11164, subd. (b).) The Reporting Act does not state that its purpose is to protect from abuse "some children" or only "children within the care and custody of the reporting party." No such qualification appearing in the text of the statute, this court should not insert such a qualification under the guise of statutory construction. (Code Civ. Proc., § 1858.) Instead, this court should accept at face value the Legislature's simple, unqualified statement that the Reporting Act is meant "to protect children from abuse," and it should construe the intended protected class broadly to include all children who foreseeably could be protected from abuse by compliance with its provisions.

[14 Cal.4th 1089] Assuming the allegations of plaintiff's complaint are true, as we are required to do at this stage of the proceeding, plaintiff is within the protected class of children who foreseeably could have been protected from abuse had defendants complied with the requirements of the Reporting Act. Had defendants reported Gadams's prior acts of sexual misconduct with students, it is reasonably probable that Gadams would have been criminally prosecuted or that his teaching credential would have been suspended or revoked, as a result of which he would never have been employed in the position by means of which he was able to molest plaintiff.

In this regard, I agree with the analysis of the Court of Appeal, which stated: "In the instant case, there can be no doubt that appellant was 'one of the class of persons for whose protection the [Reporting Act] was adopted.' The act was intended to protect future as well as current child abuse victims, as is evidenced by the requirement that indexed reports be made available to local licensing agencies."

The majority asserts that construing the class to be protected by the Reporting Act as including children, like plaintiff, who are later victimized by the same abuser "would impose a broader reporting obligation than the Legislature intended." (Maj. opn., ante, at p. 276 of 60 Cal.Rptr.2d, at p. 595 of 929 P.2d.) This is just not so. The scope of the reporting obligation remains the same regardless of whether future abuse victims are considered to be within the protected class. The composition of the protected class affects the scope of a reporting party's potential liability, but it has no effect on the scope of the reporting obligation.

Accordingly, I would permit plaintiff to proceed on the negligence per se theory embodied in count 5 of her complaint.

BAXTER and WERDEGAR, JJ., concurred.