Robinson v Lamar Central Outdoor, Inc.

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Robinson v Lamar Central Outdoor, Inc. 2012 NY Slip Op 32474(U) September 13, 2012 Sup Ct, NY County Docket Number: 109189/2010 Judge: Saliann Scarpulla 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 ON 912712012 [* 1] 3 s . . SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: PART Index Number: 109189/2010 ROBINSON, SEAN vs. LAMAR CENTRAL OUTDOOR SEQUENCE NUMBER : 004 4.- INDEX NO. MOTION DATE MOTK#I sea NO. SUMMARY JUDGMENT Thr foHowlnQ pipan, n u m b e d 1 to N W of MotlanlOrder to Show Caure O Anmrrlng AMdavltm ,w m mad on thlm moblon M o r -Amdavit8 - Exhlbb INo(8). INo@). INoCm). - Exhlbb fmlylngAWb Upon # fomgolng papers, It la ordered thrt t h l ~ O I motion k decided per the memorandum decision dated which disposes of motion sequence($)no. ($3 !IL C-0-t +cob i 1 i FILED i SEP 27 2 v O .................................................. 0 CASE DISPOSED 2. CHECK AS APPROPRIATE: ........................... MOTION is: CI QWNTED DENIED Q R A N ~ INPART D OTHER 3. CHEUK IF APPROPRIATE: ................................................ 17B C r n E ORDER 0SU8MIT ORDER 0DO NOT POST FIDUCMRY APPOINTMENT 0REFERENCE 1. CHECK O N E ....r~............. [* 2] b SWiN ROBINSON, -againstIndex No.: 109189/2010 LAMAR CENTRAI, OUTDOOR, NC.and LAMAR ADVERTISNO OF P E N , LLC, l METROPOLITAN SIGN & RIGGING Index No.: 590305/2011 Fourth-Party PlaintifT, -against- FIRST MERCURY INSURANCE COMPANY, YANKEE BROKERAGE, FNC., and JEFFREY E.GOLDSTEIN, Fourth-Party Defendants. X ----*r---- For Plaintiff Law Offices of Spar & Barnstain, P.C. 225 Broadway, 5Ln Floor New York, N 10007 Y For Defendants: Law Offlcas of Edward GarAnktl 12 Metrotach Center, 2@ Floor New York, NY 11201 -1- [* 3] a For Fourth-PartyDefendant Yankee Brqkwagp, Inc.: The Sullivan Law Group LLP 980 Avenue of the Americas, Suite 405 )NewYork, NY 10018 For Third-party Defendant: Friedman, Lavy, Goldfarb & Green, P.C. 250 West 57* Street, Suite 1619 New York, NY 10107 For Fourth-Party Defendant First Mercury: Shay & Maguire LLP 950 Franklin Avenue, Suite 101 Garden City, NY 11530 HON. SALIANN SCARPULLA, J.: These actions arise out of an accident that occurred on December 10,2009, when plaintiff Sean Robinson (L Robinson ), an employee of third-party defendant Metropolitan Sign & Rigging Corp. ( Metropolitan ), sustained injuries after he fell from an elevated structure while performing work on a billboard/structure owned by Lamar Central Outdoor, Inc. and Lamar Advertising gf PeM, LLC ( Lamar defendants ). Motion sequence numbers 004 and 006 are hereby consolidated for disposition. In motion sequence number 004, fourth-party defendant First Mercury Instmince Company ( First Mercury ) moves, pursuant to CPLR 3212, for summary jpdgment dismissing the fourth-party complaint w9 against it. Metropolitan cross-moves for summary judgment dismissing the third-party complabt EH against it. Fourth-party defendant Yankee Brokerage, Inc. ( Yankee ) cross-moves for summary judgment dismissing the fourth-party complaint as against it. In motion sequence number 006, Yankee moves, pursuant to CPLR 3025 (b), for an order granting Yankee leave to amend its anstver to the fourth-party complaint to assert the affirmative defense of the statute of frauds, and to thereby dismiss .. . , . . [* 4] Metropolitan s breach of contwct qnd breach of implied contract causes of arrtion as void mder the statute of frauds. 1 1 On May 26,2005, Metropolitan entered into an independent contractor agreement to provide certain construction work for Lamar Media Corp. ( non-partyLamar ). The agreement stated, among other things, thaE Metropolitan would procure workers Gompensation insurance, and commercial liability insurance coverage, protecting Metropolitan and any other subcontractor f o claims for damages for bodily injury. The rm ggreement further provided that Metropolitan wwld name non-party Lamar as an additional insured. There was dso a clause indicating that Metropolitan would indemnifL non-party Lamar for ( injuriesto persons or damages to property arisisg from work performed by metropolitan] under this Agree;rrimt. First Mercury, an insurance provide, issued m insurance policy to the insured, Metropolitan. This policy w s in effect h m October 1,2007 to October 1,2008, and a was subsequently renewed from October l 32008 to October 1,2010. The policy qontaiaed an endorsement entitled Additional Insured, whereby non-party Lamar was added as an additional insured. This additional h w e d , according to the agreement, was an additional insured with respect to bodily injury caused, in whole or in part, by Metropolitan s employees or Metropolitan s subaontractors. However, the policy also cQntqined a provision which exempted the insurance from applying to any employee of Metropolitan. -3- [* 5] a , > Metropolitan avers that it purchased the policy through Yankee, and specifically, Y w e e s insurance agent, Jeffrey L. Goldstein ( Goldstein ). Metropolitan afgues that, prior to 2007, Yankee procured insurance for Metropolitan that contained provisions to cover employees hurt in the course of their employment. However, according to Metropolitan, when MetrQpolitanchanged policies i 2007, pursuant to Yankee s n recommendation, Yankee unilaterally refnovcd the provision to cover injured employem. Aocording to Metropolitan s president Tom Miller ( Mlller ), in 2007, he contacted Yankee, through Goldstein, to determine whether Mehpolitw could get more competitive rates on its insurmce policies %We satisfling the requirements and neds of Metropolitan. Miller further alleges that loneaf Metropolitan s employees had recentJy been injured in 2007, and that the prior insurance policy had covered this employee. As a result, Miller claims that he emphasized to Goldstein that Metropolitan required a provision in the insurance policy which would also cover its employees and I subcontractors who are injured while working on the jobs. Miller states, [alt no time did I tell anyone from Yankee Brokerage that additional insured coverage of third parties or their employees should be removed f o the rm &mance policy. He also claims that he ww never notified that this coverage w s a removed, and was unaware of this fact until after Robinson s accident. Miller also advises that he paid all of the Metropolitan premium payments for the First Mercury insurance through Yankee. -4- [* 6] According to Goldstein, Yankee had been placing insurance coverage for Metropolitan since approximately 2005. He states that, in 2007, Miller informed him that the premiums were too high, and that Metropolitan needed to save money. In response, Goldstein states that he submitted multiple insurance applications to get the best quote. Goldstein writes that the only way that Metropolitan could reduce its premiums was to include an employee exclusion in the policy, which would exclude coverage for injuries suffered by Metropolitan s employees. Goldstein m e r provides, In addition to the difference in premiums however, I informed Miller that the CGL policy issued by First Mercury would not include coverage for bodily injury, property damage, oq,per$onalinjury to any employee of Metropolitan. Specifically, I informed Miller than Metropolitan would be losing that specific coverage it previously had with ACE, which did in fact cover Metropolitan for a prior injury claim to m e of its employees. Miller then directed me to secure the CGL coverage with First Mercury with the lower premium. Goldstein also maintains that Y n e is not an agent of First Mercury, and does ake not have any type of agency contract or agreement with First Mercury. Prior to placing coverage for Metropolitan with First Mercury, Goldstein claims that he spoke to non- party Morstan General Agency. First Mercury states that L[r]ec~rd~ that the First Mercury policy was reveal submitted by Excess and Surplm Lines Broker, Morstan General Agency, Inc., and not Yankee and/or Goldstein. For this reason, among others, First Mercury argues that there is no agency agreement between First Mercury and Yankee. -5- [* 7] I t In any event, after Robinson's accident, by letter dated October 18,2010, the insurer for the Lamar defendants s u b m W a claim to First Merwry for it to tender insurance for its insured, Metropolitan. By letter dated November 10,20 10, First Mercury notified Metropolitan that it w@ denying coverage for Robinsm'S mcident, First Mercury advised that, despite the clause for an additional insured, because Robinson was an employee of Metropolitan, he ww excluded from coverage, according to the employee exclusion portion of the policy. In response to receiving the third-party complaint, by letter dated February 4,20 11, First Mercury again responded td Metropolitan, advising Metropolitan that First Mercury was denying coverage for Robinson's accident. Robinson commenced t4is action, filing a complaint against the Lamar defendants, asserting Labor Law and negligence claims. The Lamar defendants then commenced a third-party action against Metropolitan, seeking common-law indemnification, contractual, indemnification and contribution. The Lamar defendants also asserted a claim for breach of contract for failure to procure insunme. Metropolitan commenced a fourth-party actkn against First MercuryyYankee and Goldstein, seeking a declaratoryjudgment stating that First Mercury is required to tender insurance coverage for Robinson's accident. Metropolitan also included six causes of I action as against Yankee and Goldstein. Yankee md Goldstein moved to dismiss the complaint and to sever the action. Pursuant to an order dated September 7,201 1, the -6- [* 8] i" complaint was dismissed as a g d t Goldstein individually, the action was severed solely - for trial, and the remaining claims against Yankee were for breach of fiduciary duty, breach of contract, breach of implied contract and negligence. '- A movant seeking ~ w a r judgment must make aprima facie showing of y entitlement to judgment as 4 matter of law, offering sufficient evidence to eliminate any material issues of fact. Winegrad v. New York Univ. Med. Ctr,, 64 N.Y.2d 85 1 , 853 (1 985). Once a showing has been madel the burden shifts to the opposing party who must then demonstrate the existence of a b&bk issue of fact. Alvurez v. Prospect Hasp,, 63 N.Y.2d 320,324 (1986); Zuckerman v. City oflvew York,49 N.Y.2d 557 (1980). c Third-party Actim In the third-party action, the Lamar defendants are seeking indemnification from Metropolitan, and alsg claim that Metropolitan breached its contract by failing to add the I I + ' ' c , ' '* Lamar defendants as additional insurtds. Under NEWYork Workers' Compensation Law 8 11,the Lamar defendants would be entitled to pursue third-party claims only if they bad a contract with Metropditw entitling them to indemnification, or the employee suffered a grave injw. There is no contract wherebyMetropo1it.m agreed to indenmi@ the Lamar defendants or add them additional insureds. The independent contractor agreement scets forth that Metropolitan is to indemnify non-party Larnar for any injuries to persons arising from work performed by Metropolitan. The Lamar defendants were not named as -7- [* 9] other entities which would also require indemnification. The agreement also ipdicates that Metropolitan is required to name aon-party Lamar as an additional insured. The Lamar defendants were not listed as other parties who should also be listed as additional insureds, nor did they sign the agreement. Fundamental contract law provides that a contract is to be construed so as to give effect to each and every part, and that the %ourt ahould not rewrite the terms of an agreement under the guise of interpretation [internal quotation miirks and citations omittad]. FCI Group, Inc. v. City ofNew York, 54 A.D.3d 171, 176-177 (1 Dept. 2008). Accordingly, the Lamar defendmu cannot sustain a claim for contractual indmmification or for breach of contract for failure to name t e as additional insureds hm &cause there was no contract between MetropoWm and the Lamar defendants. Nonetheless, the Lamar defendants claim that they are entitled to the benefit of the indemnification provision in the agreement between non-party Lamar and Metropolitan, becwse the Lamar defendants are wholly owned subsidiaries of non-party Lamar. The Lamar defendants cite to Chte v. E l s Hospital (1 84 A.D.2d 942,945 [3d Dept. 1992]), li in which the Court held that [the parent corporatiop] i also entitled to indemnity s because NYNEX Technical is a wholly owned subsidiary of [the parent corporation] and acted on behalf of [the parent corporation] when signing this contract. n However, as set forth by Yankee, the issue i the present case is not whether nonparty Lamar, the parent corporation, can benefit from the acts of the Lamar defendants, -8- [* 10] ,- .? c ,,. 4 but whether the Lamar defendants, as wholly owned subsidiaries, can benefit fiom a 4 contract solely entered into by their parent corporation, non-party Lamar. The Appellate Division, First Department, has held that,subsidiaries are not bound to a contfmt where r the parent corporation is the sole signatory and the contract contained no provision which would bind the subsidiaries. DaZey v. Related Cos., 198 A.D.2d 118, I19 (lSt Dept. 1993); see also Carte Blanche (Singapore) Pte., Ltd, v. Diners Club International, Zuc., 2 F.3d 24 26 (2d Cir. 1993) (C Thcparties agree that New York law guides our decision. Generally speaking, a parent corporation and its subsidiary am regarded as legally distinct entities and a contract ,uqderthe corporate name of one is not treated as that of both ). As such, the Lamar defendants, nd being named parties on the contt.act, cannot benefit from this contract entered into by their parent corporation. The Lamar defendants further allege that it was the intention of both non-party Lamar and Metropolitan that the Lamar clefendwt~ entitled to the benefit of the be depdsitions are outstanding which indemnification provision. m e y claim that c-n would make Metropolitan s cross-motion premature. However, with respect to contract interpretatian, the Court ofAppeals h a held that, %hen parties set down their agreement in a clear, complete document, their writing should as a rule be enforced according to its terms. Evidence outside the four corners of the document as to what was really intended but unstated or misstated is generally inadmissible to add to or vary the writing. W. W.Associates v. Giancontieri, 77 N.Y.2d 157, 162 (1990). W. -9- -A_.. .- . . . ... .. t. . ..~ .. . . -. . . . . ... . [* 11] Because the contract in quegtion isclear and not ambiguous, [e}xWk and parol evidence is not admissible to create an @iguity in a written agreement which is I complete and clear and unambiguws upon its face [internal quotation marks m citations d , i I omitted]. R/S Associates v. New Yorh Job Development Authoriw, 98 N.Y.2d 29,33 (2002). Accordingly, extra deposition testimony is not required at this W e . The coptract &odd be enforced according to its terns, which does not include any benefit to the L a defendants. mr As contractual indemnification is not available to the Lamar defendants, the only way that the Lamar defendants can obtain common-law indemnification or contrib@ion I frQmMetropolitan is if Robinson suffered a grave hjury. The Court of Appeals provides the following, with respect to New York Workers Compensation Law 5 11 : Workers Compensation Law 0 11 prohibits third-party indemnifrcatiop or contribution claims against employers, except where the employee sustained a grave injury, or the claim is based upan a provision in a written contract entered ipto prior to the accident or occwence by which the employer had expressly agreed to contribution to or indemnification ofthe claimant or person asserting the cawe of action for the type of loss suffered. I Rodrigues v. N & S Bldg, Contrs.,Inc., 5 N.Y.3d 427,429-430 (2005). There is no indication in the record that R&inson suffered a grave injury. Accordingly, the Lamar defendants cannot sustain cldrns for common-law indemnification and contribution. -LO- I [* 12] No issues of fact remain with respect to the third-party claims. As sudh, Metropolitan is granted summary judgment on its c r o s ~ motion dismissing the thirddparty action as against it. The Fourth-Party Action First Mercury moves for s u m m q judgment dismissing the fourth-party action as against it. Yankee cross moves for s u m a y judgment dismissing the fourth~pmty action as against it. In the third-party complaint, the %mar defendants were seeking to be compensated by Metropolitan, in the event that Robinson recovered damages f m the r Lamar defendants in the original action. The Lamar defendants were also l o o b g to be indemnified pursuant to the contract between non-party Lamar and Metropolitan, They also sought to receive coverage under Metropolitan's insurance policy. As a result of this court's decision to $rant Metropolitan summary judgment dismissing the third-party action as against it, the Lamar defendants have no viable claims \ against Metropolitan. As such, Metropolitan no longer has any sustainable claims in the fourth-party action. For instance, Metroplitm*scontentions that it needs the First Mercury policy paid, and that Yankee failed to procure insurance pursuant to Metropolitan's needs, among other allegations, m moot. As such, where, as here, all claims & n ~ t a defendant, in this case Metropolitan, are dismissed, "third-partyactions and all cross claims are dismissed ELS a necessary -11- I . . ,.. . ILL. _. . c [* 13] w consequence of dismissing the complaint in its entirety." Turchioe v. AT & T Communications, 256 A.D.2d 245,246 (lot Dept 1998). Accordingly, First Mercury is granted sm w judgment dismissing the fourthu m party action as against it. Likewise, Yankee is granted summary judgment dismissing the fourth-party action as against it. Yankee's Motion to Yankee seeks to amend its answer to include the affirmative defense of statute of frauds, and to use this defense to obtain an wder dismissing Metropolitan's cawes of wtion as against Yankee grounded in breach of contract. As a result of this decision, the fourth-party complaint is dismissed as against all parties. Consequently, Yankee's motion to amend its answer is denied as moot. In accordance with the foregoing, it is hereby ORDERED that First Mercury Insurance Company's motion (motion sequence r rzwber 004) for summary judgment dismissing the fourth-party complaht as against it is granted, and the fourth-party cornplaint is dismissed w against it; and it is further ORDERED that Metropolitan S i p & Rigging Corp.'s cross motion for summary judgment dismissing the third-party complaint as agahnst it is granted, and the third-party I cbplaint is dismissed as against it; and it is further .. " [* 14] $ . > I ? , . L ORDERED that Yank% Brokeragt?, b . ' s cross motion for su.mmaryjudgmegt dismissing the fourth-party cornplaint as b p h s t it is granted, and the fourth-party r* complaint is dismissed 89 against it; m it is further d ORDERED that Yankee Brgkera&e,hc.'s motion (motion sequence number 006) for an order granting Yankee Brokerage, Inc. leave to file and serve its amendad answer to the fourth-party complaint to assert the affmative defense of the statute of fiwds, and thereby dismissing Metropolitan Sign & Rigging's breach of contract and b r w h P f hplied contract causes of action as void under the statute of frauds, is denied; and it is I further ORDERED that the remrtining claims shall be severed and shall continue and the Clerk of the Court is directed to enter judgment accordingly. This constitutes the decision m order of the court. d Dated: New York, New York , -13- I.

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