333 Fifth Ave. Assoc., LLC v Utica First Ins. Co, SPN Inc.

Annotate this Case

Download PDF

333 Fifth Ave. Assoc., LLC v Utica First Ins. Co, SPN Inc. 2012 NY Slip Op 31027(U) April 13, 2012 Supreme Court, New York County Docket Number: 116261/09 Judge: Manuel J. Mendez Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. SCANNED ON411812012 [* 1] SUPREME COURT OF THE STATE OF NEW YORK MANUEL J. W IDEZ E Justice PRESENT: 333 FIFTH AVENUE ASSOCIATES, LLC and KHEDOURI ASSOCIATES, LLC, Plaintitto, -against- Tho followinu . . - papem, numbered I to 10 cross-motions for summary Judgment- - NEW YORK COUNTY PART INDEX NO. MOTION DATE MOTION SEQ. NO. MOTION CAL. NO. I3 I16261109 02 -28-2012 001 were mad on this motlon to/for irrmmary ludnment and PAPERS NUMBERED 1-4,5-6.8-9 7 IO 2 0 Cross-Motion: XYes No Upon a readlng of the foregolng papers cited papers, it is ordered that TOWER INSURANCE COMPANY OF NEW YORK s motlon for summary judgment, Is granted. UTICA FIRST INSURANCE COMPANY S cross-motion for summary judgment is. granted. Plaintiffs cross-motion for summary judgment, is denled. An underlylng bodily Injury action was commenced by co-defendant Manuel Mendleta in Supreme Court, Kings County, under Index #21904105. He sought to recover damages for personal injuries sustalned on March 2,2005, as a result of a fall down an elevator shaft while employed by SPN, Inc. (hereinafter referred to as SPN ). An employee of Perfume Valley Gift Shop, Inc. (hereinafter referred to as Perfume Valley ) provided the elevator key to SPN s employee. SPN dld not have the elevator key although it was given one from the plaintiffs and borrowed Perfume Valley s key to access Its storage area in the basement. The elevator key opened the doors on the ground floor. Manuel Medleta started to enter through the opened doors, but failed to notice the elevator was not there and fell to the basement of the building. On September 15, 2009, the Appellate Dlvlslon, Second Department determined that Indemnification Agreements between the Plaintiffs, SPN and Perfume Valley, for the use of the elevator key vlolated General Obligations Law 95-321, and were unenforceable (Mot. Exh. J). On November 18, 2009, plalntlffs brought this declaratory judgment based on provisions In the leases (Mot. Exh. A). On October 21 , 2010, a settlement agreement was reached In the personal injury action for $600,000.00 (Mot. Exh. K). Tower Insurance Company of New York (hereinafter referred to as Tower ) Is the carrier for SPN. Utica Flrst Insurance [* 2] Company (hereinafter referred to as Utlca First ), is the insurance carrier for Perfume Valley. Utica Mutual Insurance Company (hereinafter referred to as Utica Mutual ), is the Insurance carrier for the plaintiffs. Pursuant to the settlement agreement, each carrier agreed to provisionally fund $200,000.00 to settle the underlying action. The settlement agreement states that this declaratory judgment actlon will determlne each insurance carrler s ultimate share of the total settlement amount, the respectlve duties to defend and Indemnify the landlord, and the priority of available Insurance coverage for the beneflt of the landlord. The settlement agreement also states that the landlord s clalms against SPN and Perfume Valley and all cross-claims asserted by or against SPN and Perfume Valley in this declaratory judgment action, wlII be discontinued with prejudice. Tower seeks summary judgment because the plalntlffs do not qualify as an addltlonal insured and there Is no duty to defend or Indemnify. Tower claims it tlmely and properly dlsclaimed coverage. I Utlca First cross-moves for summary judgment clalmlng that the plalntlffs were not insured as part of their primary policy, only the umbrella policy. Utlca Flrst also claims that its umbrella or excess policy only applies to claims over the one million dollar primary policy issued by Utica Mutual and there Is no coverage. Plalntlffs oppose both Tower and Utica First s motions and cross-move for summary Judgment based on Tower and Utica First s duty to defend and indemnify pursuant to the lease. In order to prevail on a motion for summary judgment pursuant to CPLR $3212, the proponent must make a prima facie showing of entltlement to judgment as a matter of law, through admissible evldence, eliminating all material Issues of fact (Klein v. City of New York, 89 N.Y. 2d 833,675 N.E. 2d 548,652 N.Y.S. 2d 723 [1996] and Alvarez v. Prospect Hospltal, 68 N.Y. 2d 320, 501 N.E. 2d 572, 508 N.Y.S. 2d 923 [1986]). Once the moving party has satisfied these standards, the burden shifts to the opponent to produce contrary evidence In admissible form, sufficient to require a trial of materlal factual Issues (AmatuIII v. Delhi Constr. Corp., 77 N.Y. 2d 525, 571 N.E. 2d 645; 569 N.Y.S. 2d 337 [1999]). An Insurer s duty to defend additional Insureds and named Insureds, arise whenever the allegations within the four corners of the underlying complalnt glve rise to a covered clalm (Worth Constr. Co., Inc. v. Admiral Ins. Co., 10 N.Y. 3d 411, 888 N.E. 2d 1043, 859 N.Y.S. 2d 101 [2008]). An Insurer is required to defend if there Is a possibility of coverage, regardless of whether the claim Is, groundless, false or baseless (Automobile Ins. Co. of Hartford v. Cook, 7 N.Y. 3d 131, 850 N.E. 2d 1152, 818 N.Y.S. 2d 176 [2006]). To be relieved of Its duty to defend, an Insurer has the burden of establishing that the causes of actlon are completely wlthln an exclusion, there Is no other reasonable Interpretation and there Is no factual or legal basis upon whlch the Insurer may be obligated to Indemnify the insured (Frontier Insulation C0ntrs.v. Merchants Mut. Ins. Co., 91 N.Y. 2d 169, 090 N.E. 2d 866,667 N.Y.S. 2d 982 [1997]). The duty of an insurer to defend based on the posslblllty of liability is broader than the duty to indemnify. Indemnification is based on the Insured s actual llablllty to a third party (Argo Corp. v. Greater N.Y. Mut. Ins. Co., 4 N.Y. 3d 332. 827 N.E. 2d 762,794 N.Y.S. 2d 704 [2005]). [* 3] The complaint alleges that pursuant to the lease, both Perfume Valley and SPN were required to obtain and maintain an Insurance policy naming the plaintiffs as additional Insureds. Perfume Valley and SPN were to obtaln and maintain an insurance policy providing general llablllty coverage applicable to all of the claims asserted by Manuel Mendieta In the personal injury action. The complaint also alleges that Perfume Valley and SPN sprimary policy requlre Tower and Utica First to provide coverage, defense and indemnification to the plaintiffs which was not provided (Mot. Exh. A). The cornplaint relles on paragraph 8 of both Perfume Valley and SPN s lease to establish liability (Mot. Exhs. C & D). Pursuant to Paragraph 8 (b) of the leases the tenant Is requlred to obtain Publlc Llablllty and Property Damage Insurance naming the plalntlffs as additional insureds. Paragraph 8(a) states In relevant part, Landlord or its agents shall not be liable fo,r any damage to property ...nor for any injury or damage to persons or property resulting from any cause of whatsoever nature, unless caused by or due to the negligence of Landlord, Its agents, servants or employees . . . I Tower s disclaimer relies on policy form CG 01 63 09 99, of Its Commercial General Liablllty Coverage, which states in relevant part, ..,I. lnsurlng Agreement a. We will pay those sums that the insured becomes legally obligated to pay as damages because of bodily Injury ...to whlch this Insurance applies. We will have the right and duty to defend the Insured against any suit seeking those damages ...However, we will have no duty to defend the Insured against any suit seeking damages for bodlly InJury or property damage to which thls insurance does not apply ... Tower also relies on policy form CG 20 26 I 85, an endorsement which changes I the terms of the policy concerning addltlonal Insured designated persons, it states in relevant part, - WHO IS AN INSURED (Section II) Is amended to include as an Insured the persons or organization shown In the Schedule as an insured but only wlth respect to llablllty arising out of your operatlons or premlses owned by or rented to you. (Aff. of Lowell Aptman, Exhs. A & B) Tower claims that the addltlonal Insured endorsement is not triggered because Perfume Valley was not named as a defendant in Manuel Mendieta s personal Injury action and there were no causes of action for negllgence brought against Perfume Valley In the underlylng action. It also claims Manuel Mendieta was SPN s employee, the elevator doors were opened by an employee of SPN and the accident did not occur on Perfume Valley s leased premises. The elevator and shaft were neither owned or rented by Perfume Valley. Perfume Valley was only brought into the Kings County action by the plaintiffs as third parties based on an indemnification agreement that was [* 4] found Invalid by the September 15, 2009 Decision of the Appellate Division, Second Department (Mot. Exhs. H, I & J). The Appellate Division Second Department found that the plalntlffs In this actlon were negligent in maintaining what they knew to be an unsafe condition on the premises and that Manuel Mendietta s accident was foreseeable. The decision also found that as to SPN s liability there remained an issue of fact as to whether Manuel Mendietta, acted in a manner that severed the, ... causal connections between the owners alleged negligence and the plaintiff s (Manuel Mendietta s) injury (Manuel Mendietta v. 333 Fifth Ave. Assn., 65 A.D. 3d 1097, 885 N.Y.S. 2d 350 [N.Y.A.D. 2ndDept. 20091). Plalntlffs state that the dlsclalmer was Improper based on the provisions of the lease. They claim Perfume Valley was negligent and liable because It provlded the key to SPN s employee and the key was exclusively given to Perfume Valley. Plaintiffs also state that Tower waived its claim of timely disclaimer based on lack of notice. Upon review of the papers submitted this Court finds that no claims of negligence were asserted against Perfume Valley In the underlying personal injury action brought by Manuel Mendletta. Plaintiffs have not established Perfume Valley was negligent. Plaintiffs have failed to establish that they were not negligent so that the lease provision would require coverage. Tower s policy does not cover the plaintiffs for the causes of actlon asserted in the underlying action and disclaimer was timely. Utlca Flrst claims that the plaintiffs are only covered under their umbrella pollcy Issued to SPN under policy number ULC 1244082 00. The umbrella policy does not apply to claims under one mllllon dollars and since the case settled for $600,000.00 It has not been triggered. The Utlca Flrst primary policy Issued to SPN under policy number BOP 1244081 00, does not contain an addltlonal Insured endorsement and there Is no reference to the plaintiffs anywhere else on the pollcy, Including the Declaration page (Utlca First s Cross-Mot. Exh. A). Plaintiffs state Utica First s primary policy includes the plaintiffs as an additional Insured pursuant to the Certificate of Insurance and two letters ldentlfylng them as additional Insured sent by Jeffrey Mount; a claims adjuster (Plalntlff s Cross-Mot. Exhs. 0 &Q). Plaintiffs also claim that Indemnification under the lease agreement does not fall under the primary policy exclusions and they should be covered. A party claiming Insurance coverage has the burden of establishing entltlement. A party that is not named as an additional Insured on the face of a policy is not entitled to coverage. A certificate of insurance does not confer coverage, or establish as conclusive proof that coverage exlsts. A carrier is not required to dlsclalm coverage when there Is no coverage in existence (Tribeca Broadway Assoclates, LLC v. Mount Vernon Flre Ins. Co., 5 A.D. 3d 198,744 N.Y.S. 2d 11 [ N.Y.A.D. 1lt Dept., 20041). Plaintiffs cannot establish based on the Certificate of Insurance alone that the primary policy Included the Plaintiffs as additional Insureds. The lack of a policy exclusion does not establish that the plaintiffs were named as additional insureds under Utica First s primary policy. The claims adjuster did not bind the insurance company and his letters did not alter the fact that the primary policy does not have a provision naming plaintiffs as additional insureds. [* 5] Upon a review of all the papers submitted this Court finds that Utlca Flrst has met its burden of proof and the plaintiffs were not additional Insureds under SPN s primary policy. Accordingly, it is ORDERED that the TOWER INSURANCE COMPANY S motion for summary judgment, is granted, and it is further, ADJUDGED and DECLARED that TOWER INSURANCE COMPANY was not required to provide coverage, indemnify or provide a defense to the plaintiffs in the Supreme Court, Klngs County actlon flled under Index #21904/05, and it is further, ADJUDGED and DECLARED that TOWER INSURANCE COMPANY may enter judgment agalnst the plalntlffs for $200,000.00 provlslonally paid towards settlement of the Supreme Court, Kings County action flled under Index #21904/05, together wlth costs and disbursements as taxed by the Clerk, and It Is further, ORDERED that the UTICA FIRST INSURANCE COMPANY S motion for summary Judgment, is granted, and it is further ADJUDGED and DECLARED that UTICA FIRST INSURANCE COMPANY may enter Judgment against the plaintiffs for $200,000.00 provisionally pald towards settlement of the Supreme Court, Kings County action filed under index #21904/05, together wlth costs and disbursements as taxed by the Clerk, and It is further, ORDERED that the plaintiffs cross- motion pursuant to CPLR $3212 for summary judgment, Is denled, and it is further, ORDERED that pursuant to stipulation the clalms and cross-claims against SPN, INC. and PERFUME VALLEY GIFT SHOP have been discontinued with prejudice and there are no causes of action asserted agalnst MANUEL MENDIETA, named a necessary party to this action, and as to these parties, the complaint is dismissed . This constitutes the declslon, order and judgment of this court. Dated: April 13, 2012 ENTER: Check one: X FINAL DISPOSITION Check if appropriate: NON-FINAL DISPOSITION 0 DO NOT POST UNFILED JUDGMENT Thls judgment has not been entered by the County Clerk and notice of entry cannot be served based hereon. To obtain entry, counsel or authorized representative must appear in person at the Judgment Clerk s Desk (Room 1418). 0 REFERENCE

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.