Summary of H. R. Moch Co. v. Rensselaer Water Co., Ct of App. N. Y. 1928
Privity of Contract – Duty
Relevant Facts: Df a waterworks company made a contract with the city of Rensselaer to supply water throughout the utility system, especially fire hydrants. The cost for each hydrant was $42.50 per year. A building caught fire, and df, being notified, failed to provide, supply or furnish sufficient water to suppress the fire. Df was equipped to provide the water sufficient to prevent the destruction of the building and the spread of the fire.
Legal Issue(s): Whether the df is liable to the pl under a contract with another party not at issue?
Court’s Holding: No
Procedure: Motion to dismiss was denied at Special Term, App. Div. reversed. Affirmed.
Law or Rule(s): Liability does not extend beyond the zone of the parties who entered into a contract.
Court Rationale: If the wrongdoer has advanced to such a point to have launched a force or instrument of harm he would be liable. Liability does not extend past the zone of the parties who entered into a contract. Duty exists between the makers of the contract. Otherwise everyone making a promise or contract would have a limitless duty, apart from the contract, to an indefinte number of potential beneficiaries once performance had begun. The law does not spread its protection so far. [Robins Dry Dock]
Plaintiff’s Argument: Df after entering into a contract with the city, was under a duty to provide water to everyone who would benefit from a supply of water to hydrants, and without notice and failure is negligence.
Defendant’s Argument: Df had not entered into an agreement with the pl, and therefor had not legal duty to uphold.