New York Law Review

Tag: Weinberg v. D-M Restaurant Corp.

  • Weinberg v. D-M Restaurant Corp., 53 N.Y.2d 881 (1981): Gratuitous Bailment and Prima Facie Gross Negligence

    Weinberg v. D-M Restaurant Corp., 53 N.Y.2d 881 (1981)

    A gratuitous bailee is liable only for gross negligence, and the failure to return the bailed object establishes a prima facie case of gross negligence, requiring the bailee to provide an explanation.

    Summary

    Weinberg sued D-M Restaurant Corp. for the loss of a suitcase allegedly entrusted to a restaurant usher. The core issue was whether the usher’s agreement to watch the suitcase created a gratuitous bailment and whether the restaurant was grossly negligent in its loss. The Court of Appeals held that the questions of bailment, scope of employment, and gross negligence were factual issues for the jury. The court affirmed that failure to return the bailed item constitutes prima facie evidence of gross negligence, but the ultimate burden of proof remains with the bailor. The denial of a directed verdict for Weinberg was deemed proper.

    Facts

    Plaintiff Weinberg claimed that the restaurant’s usher, Pereira, agreed to watch his suitcase.
    Weinberg alleged the suitcase was lost while under Pereira’s care.
    The restaurant presented evidence, including Pereira’s deposition and a police report, indicating the suitcase went missing while Pereira was briefly away.
    Pereira denied any knowledge of what happened to the suitcase.

    Procedural History

    Weinberg sued D-M Restaurant Corp. in an unspecified lower court.
    The trial court submitted the case to a jury.
    Weinberg requested a directed verdict on the issue of gross negligence, which was denied.
    The Appellate Division’s order was appealed to the New York Court of Appeals.
    The Court of Appeals affirmed the Appellate Division’s order.

    Issue(s)

    Whether the usher, Pereira, was acting within the scope of his employment when agreeing to watch Weinberg’s suitcase.
    Whether Pereira agreed to watch Weinberg’s suitcase, thus creating a bailment.
    Whether the restaurant, through Pereira, was guilty of gross negligence, given the circumstances of the suitcase’s disappearance.

    Holding

    Yes, because under the testimony presented, whether the usher was acting within the scope of employment, whether a bailment existed, and whether there was gross negligence were questions of fact properly submitted to the jury.

    Court’s Reasoning

    The court emphasized that the existence of a bailment, the scope of the usher’s employment, and the presence of gross negligence were all factual questions appropriately decided by the jury based on the presented evidence. The court reiterated the established rule that “even as to a gratuitous bailee the failure to return the object bailed establishes a prima facie case of gross negligence, requiring the bailee to come forward with an explanation”. However, this only shifts the burden of going forward with the evidence; the ultimate burden of proof remains on the plaintiff (bailor). The court noted the defendant offered the usher’s deposition and police report, both of which the jury could have interpreted in different ways, including inferring the suitcase was stolen while unattended. The Court cited precedent including Dalton v. Hamilton Hotel Operating Co., Hasbrouck v. New York Cent. & Hudson Riv. R.R. Co., Castorina v. Rosen, and Claflin v. Meyer to support the principles regarding gratuitous bailment and the burden of proof. The court concluded it was not erroneous to deny the plaintiff’s request for a directed verdict because the jury was entitled to weigh the evidence and make its own determination on the issue of gross negligence, particularly considering the conflicting accounts of what happened to the suitcase. The court implicitly acknowledges that even with a prima facie case established, the jury is not *required* to find in favor of the plaintiff; they must still be persuaded by the evidence presented, considering that the burden of proving gross negligence ultimately falls on the bailor.

  • Weinberg v. D-M Restaurant Corp., 53 N.Y.2d 499 (1981): Restaurant’s Liability for Loss of Checked Coat Limited by Statute

    Weinberg v. D-M Restaurant Corp., 53 N.Y.2d 499 (1981)

    Under New York General Business Law § 201, a restaurant’s liability for loss of a patron’s checked property is limited to $75 unless a greater value is declared and a written receipt is issued, and a customary tip given to a checkroom attendant does not constitute a “fee or charge exacted” by the restaurant.

    Summary

    A patron sued a restaurant for the loss of her fur coat that she had checked. The restaurant argued its liability was limited to $75 under General Business Law § 201 because no value was declared. The patron contended the customary tip given to the checkroom attendant constituted a “fee or charge” that would negate the statutory limitation and that the restaurant was required to post notice of the statute to benefit from its liability limitations. The Court of Appeals held that the tip was not a “fee or charge exacted” by the restaurant and that restaurants are not required to post the provisions of § 201. Thus, the restaurant’s liability was limited to $75.

    Facts

    The plaintiff checked her Russian sable fur coat at the defendant restaurant’s checkroom. She received a check but did not declare the coat’s value. The coat disappeared, and the restaurant could not explain its disappearance. The restaurant did not charge a fee for checking coats, but the checkroom attendant received tips, a portion of which was shared with the owner.

    Procedural History

    The plaintiff sued for negligence. The defendant moved for summary judgment to limit recovery to $75 based on General Business Law § 201. The plaintiff cross-moved for summary judgment, arguing the tip was a fee. Special Term denied both motions. The Appellate Division modified, granting the plaintiff summary judgment on liability and remanding for trial on damages, finding factual questions existed regarding whether the restaurant “exacted” a fee. After trial on damages, the trial court determined that the tips constituted a fee as a matter of law, and the jury awarded the plaintiff $7,500 in damages. The Appellate Division affirmed. The defendant appealed to the Court of Appeals.

    Issue(s)

    1. Whether a tip or gratuity customarily given to a checkroom attendant constitutes a “fee or charge * * * exacted” for the checking service within the meaning of section 201 of the General Business Law?

    2. Whether restaurants are required to post the provisions of section 201 of the General Business Law to be entitled to its limitation of liability?

    Holding

    1. No, because the tip given to the checkroom attendant is not a “fee or charge * * * exacted” for the checking service within the meaning of section 201 of the General Business Law.

    2. No, because restaurants are not required to post the provisions of section 201 to be entitled to its limitation of liability.

    Court’s Reasoning

    The court relied on Honig v. Riley, which construed similar language in General Business Law § 201. The court stated that the statute limits recovery to $75 unless a value is declared and a receipt obtained, absent a “fee or charge [was] exacted.” The court distinguished between a “service charge” exacted by the employer and a voluntary payment by the patron to the employee. Citing cases from other jurisdictions, the court noted that a tip is generally considered a voluntary payment, not a compulsory fee. Because there was no fixed charge, sign, or solicitation, and the payment of a tip was discretionary, the court concluded that no fee was exacted. Regarding the posting requirement, the court noted that the statute requiring posting explicitly applies to hotels and motels, not restaurants. The court declined to extend the posting requirement to restaurants, stating that such a change must be made by the legislature. The court also addressed the plaintiff’s argument that the restaurant’s failure to prove the coat was not stolen by its employees negated the limitation of liability. The court rejected this argument because the plaintiff’s complaint was based solely on negligence, not conversion, and had never been amended. The court emphasized that a plaintiff cannot recover on a theory not pleaded. As the court stated, “The statute is aimed at loss or misadventure. It has no application to theft by the defendant or his agents”.