83 N.Y.2d 579, 611 N.Y.S.2d 817, 634 N.E.2d 189 (N.Y. 1994)
Palka v. Servicemaster Management Services Corp.
Does a contractor that undertakes a comprehensive and exclusive safety and maintenance program for a hospital owe a duty of reasonable care in tort to a non-contracting third party (a hospital nurse) foreseeably protected by that program, such that the contractor may be liable for negligent performance?
Under New York law, a party that undertakes to render services to another, which it should recognize as necessary for the protection of third persons, may owe a duty of reasonable care to those third persons. Liability may arise where (1) the negligent performance of the undertaking launches or increases the risk of harm, (2) the undertaking has been relied upon, or (3) the undertaking is so comprehensive and exclusive as to displace the other party's duty to maintain a safe condition. Restatement (Second) of Torts § 324A; see also New York duty analysis balancing foreseeability, the relationship of the parties, the scope of the undertaking, and policy limits against indeterminate liability.
Yes. Servicemaster, having assumed a comprehensive and exclusive obligation to design and manage the hospital's maintenance and safety program for the protection of those on the premises, owed a duty of reasonable care to the plaintiff nurse. The Court of Appeals reversed the intermediate appellate court and reinstated the verdict for the plaintiff.
Palka is a leading New York case on assumed duty and contractor liability to non-contracting third parties. It clarifies that a comprehensive and exclusive maintenance and safety undertaking can generate a tort duty to those foreseeably protected by the program, even absent privity. The decision lays the groundwork for the later Espinal framework identifying when contractors may be liable to third parties, and it teaches students how courts weigh foreseeability, scope of the undertaking, reliance, and policy concerns (including limiting principles against indeterminate liability). Palka is frequently used to contrast outcomes in Moch, Strauss, and cases involving narrow or incidental service contracts.