Travelers Prop. Cas. Co. of Am. v Selective Ins. Co. of N.Y.

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Travelers Prop. Cas. Co. of Am. v Selective Ins. Co. of N.Y. 2013 NY Slip Op 32176(U) September 11, 2013 Sup Ct, New York County Docket Number: 101537/12 Judge: Paul Wooten Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various state and local government websites. These include the New York State Unified Court System's E-Courts Service, and the Bronx County Clerk's office. This opinion is uncorrected and not selected for official publication. SCANNED ON 911712013 [* 1] ME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY HON. PAUL WOOTEN PART 7 Justice d PLAZA CONSTRUCTION INDEX NO. 101537112 MOTION SEQ.NO. 002 SURANCE COMPANY, Defendants. Affidavits idavits - Exhibits (Memo) - Exhibits (Memo) s declaratory judgment action arises from an underlying personal injury action nno v Gotham Constr. Corp., Marburt Holding Corp., f/Wa 1125 Assocs., Inc., and tr. Corp., index no. 3 1324212008 currently pending in the Supreme Court, New York he underlying action). In the underlying action, a journeyman electrician, Albert T. nno), an employee of defendant Selective Insurance Company of New York s n he slipped and fell on a small piece of pipe while woping at a demolition/renovation n motion sequence number 002, Selective moves, pursuant to CPLR 3212(a), for nal summary judgment declaring that, should a trier of fact in the underlying action factual determination that Zunno s accident arose out of the work of codefendant International Specialty Lines Insurance Company s (American) named insured, TriPage 1 of ll [* 2] ntling Corporation (Tri-State), then American must provide plaintiff Travelers alty Company of America s (Travelers) named insured, plaintiff Plaza orporation (Plaza), with a defense and indemnification on a primary and non- BACKGROUND te of the accident, Plaza owned the premises where the accident took place. Zunno, along with his coworkers, reported to their Belway foreman for their work that day. Belway served as the electrical subcontractor on the project underway 5. After they received their assignments, they all went to the sixth floor of the trieve their tools from the Belway gang box. Zunno testified that, as he began gang box, he stepped with [his] left foot and the next thing [he] knew [he] was oor (Notice of Motion, exhibit K, Zunno transcript [tr.] at 249-250). g his accident, one of Zunno s coworkers, who had witnessed the accident, unno the approximately six-inch long and one-half-inch thick piece of used black ipe (the pipe) that had caused Zunno to fall. Zunno testified that the pipe was not I pipe or conduit, but the type of pipe typically used by steamfitters or plumbers (id. s former job superintendent, Michael Walsh (Walsh), testified that Tri-State, which Plaza to perform demolition work at the premises, was responsible for removing is (Notice of Motion, exhibit 1,Walsh tr. at 52). Tri-State s field supervisor, el (Scherel), also testified that Tri-State was responsible for clearing up any and eated as part of its work. Scherel explained that, if there was not enough debris to top container, Tri-State workers would center pile the debris for removal during , In addition, Tri-State was also responsible for the removal of the HVAC ducts, plumbing and the sprinkler systems/piping throughout the various floors of the Page2of 11 [* 3] e sprinkler pipes, which were dismantled and removed by Tr+State, were black in er dismantling the sprinkler pipes, Tri-State would drop [them] to the floor (Notice of hibit MI Scherel tr at 95). Iway s electrical foreman, Anthony Ferraro (Ferraro), testified that on the date of the e project was still in the beginning stages, with demolition actively going on at the otice of Motion, exhibit N, Ferraro tr. at 59). At this time, Tri-State was involved in of debris [a]Il over the building (id. at 62). Ferraro, who witnessed Zunno s ified that he examined the pipe which caused Zunno to fall immediately after the aro described the pipe as approximately one-half inch thick and black in color. intained that the pipe was part of the sprinkler system, which was dismantled and by Tri-State (id. at 140). In addition, Ferraro observed Tri-State dismantling, molition work on.the sprinkler system prior to Zunno s accident on the sixth floor erraro noted that on, and prior to the date of the accident, there were no onsite I sing half-inch-thick pipe in the performance of their work. t Agreements and Insurance Policies ant to a subcontractor agreement dated January 1,,/2008, Plaza retained Tri-State demolition work at the project (the Plaza/Tri-State agreement). An insurance ovision included in the PlazaITri-State agreement contractually obligated Triand maintain additional insured coverage for Plaza, in the amounts of $1 million overage per occurrence and $10 million in umbrella coverage. At some point prior of the underlying loss, under policy number PROP2189059, with effective dates of of January 22, 2008 to January 22, 2009, American issued a Commercial General GL) policy of insurance to Tri-State, providing it with $1 million in coverage per nce and $2 million in aggregate (the American policy alkla the Chartis policy). vant to the present motion, the American policy contains the following additional Page3of I1 [* 4] ITIONAL INSURED/PRIMARY COVERAGE ENDORSEMENT orsement modifies insurance provided under the following: MERCIAL GENERAL LIABILITY AND PROFESSIONAL LIABILITY POLICY sideration of an additional premium of $INCLUDED it is hereby agreed that lowing is included as an Additional Insured as respects Coverage A and B nly as respects liability arising out of your work for the Additional Insured ED BY WRITTEN CONTRACT y to bodily injury or property damage arising out of the sole I misconduct of, or for defects in design furnished by, the ge afforded by the Additional Insured, this insurance is ary and non-contributory, and our obligations are not affected by any other rance carried by such Additional Insured whether primary, excess, ent or on any other basis. oes not increase the Company s limits of liability as specified r terms, conditions, and exclusions shall remain the same (Notice of y, American policy additional insured ement number 7 ) . ay 8, 2008, Plaza and Belway entered into a construction contract, pursuant to was retained to perform electrical work at the project (the Plaza/Belway ursuant to the Plaza/Belway agreement, Belway was required to obtain and tional insured coverage for Plaza in the amounts of $1 million in primary coverage occurrence. In addition, such coverage was to be to the date of the underlying loss, under policy number S 1731297, with effective January 1, 2009, Selective issued a CGL policy of / ). Contained within the Selective policy are two [* 5] ts, amending the policy to include as an additional insured any m Belway agreed, in a written contract or agreement entered ate of loss, to obtain insurance coverage (the Selective policy additional I insured endorsements contained within the Selective policy oing operations of the named insured (the ongoing operations endorsement), and s to completed operations of the named insured (the completed operations oing operations endorsement provides, in pertinent part, as follows: IONAL INSURED - OWNERS, LESSEES OR CONTRACTORS MATIC STATUS WHEN REQUIRED IN CONSTRUCTION AGREEMENT orsement modifies insurance provided under thkfollowing: RCIAL GENERAL LIABILITY COVERAGE PART ION It - WHO IS AN INSURED is amended to include as an additional on or organization when you and such person or organization in writing in a contract or agreement that such person or be added as an additional insured on your policy. Such person or ation is an additional insured only with respect to liability arising out of going operations performed for that insured. A person s or organization s red under this endorsement ends when your operations for that respect to the insurance afforded to these additional insureds, the additional exclusions apply: his insurance does not apply to A. Bodily injury , property damage or personal and advertising injury arising ut of the rendering of, or failure to render, any professional architectural, ngineering or surveying services. * * * B. Bodily injury or property damage occurring after: (1) All work, including materials, parts or equipment furnished in connection with such work, on the project (other than services, maintenance or repairs) to be performed by or on behalf of the additional insured(s) at the site of the covered operations has Page 5 of 11 [* 6] been competed; or (2) That portion of your work out of which the injury or damage arises has been put to its intended use by any person or organization other than another contractor or subcontractor engaged in performing operations for a principal as a part of the same project (Notice of Motion, exhibits G and HI Selective policy, ongoing operations endorsement). mpleted operations endorsement provides, in pertinent part, as follows: NAL INSURED - OWNERS, LESSEES OR CONTRACTORS ED OPERATIONS -AUTOMATIC STATUS WHEN REQUIRED IN CTION AGREEMENT WITH YOU orsement modifies insurance provided under the following: RCIAL GENERAL LIABILITY COVERAGE PART . SECTION 11 - WHO IS INSURED is amended to include as an ional insured any person or organization when you and such person or rganization have agreed in writing in a contract or agreement that such person r organization be added as an additional insured on your policy. Such person anization is an additional insured only with respect to liability for bodily or property damage caused, in whole or in part, by your work performed at additional insured and included in the products-completed operations With respect to the insurance afforded to these additional insureds, ing additional exclusions apply: is insurance does not apply to: dily injury, property damage or personal and advertising injury the rendering of, or failure to render, any professional architectural, ing or surveying services. * * * erage shall be excess with respect to the person or organization as an additional insured by its provisions; any other valid and collectible urance that person or organization has shall be primary and not contributory ntract or agreement referred to above (Notice of Motion, exhibits G and ve policy, completed operations endorsement). Additional Insured Coverage Under the American Policy e additional insured endorsement contained in the American policy, an entity a in this case), is entitled to additional insured coverage where required by written ere the bodily damage or property damages arises out of the named insured s Page6of 11 [* 7] work for the additional insured (Plaza). This additional insured coverage does not ily injury or property damages arising out of the sole negligence or willful f, or for defects in design furnished by, the Additional lnsured [Plaza] (Notice of ibit E, American policy, American policy additional insured endorsement number 7). er, the American policy s additional insured endorsement also provides that [als erage afforded by the Additional Insured, this insurance is primary and non- , and our obligations are not affected by any other insurance carried by such sured whether primary, excess, contingent or on any other basis (id.). as an insurance procurement provision included in the Plaza/Tri-State agreement bligated Tri-State to obtain and maintain additional insured coverage for Plaza, ier of fact determine that the accident in the underlying action arose out of the work s named insured, Tri-State, Plaza would be entitled to additional insured coverage merican policy s additional insured endorsement. ht to Additional lnsured Coverage Under the Selective Policy ially, as it is undisputed that the project was in its early stages and ongoing at the accident, regarding additional insured coverage for Plaza, the Selective policy s erations endorsement regarding additional insured coverage for Plaza, and not the perations endorsement, applies in this matter. ngoing operations endorsement recognizes, as an additional insured, persons or s which Belway agreed in writing in a contract or agreement to be additional th respect to liability arising out of [Belway s] ongoing operations performed for that otice of Motion, exhibits G and H, Selective policy, ongoing operations ent). Thus, pursuant to the Plaza/Belway agreement, as Belway was required by the y agreement to obtain and maintain additional insured coverage for Plaza, should act determine that the accident in the underlying action arose out of Belway s Page 7 of 11 [* 8] ions performed for Plaza, Plaza would be entitled to additional insured coverage der to determine the priority of coverage among different policies, a court must consider all of the relevant policies at issue (5PA.C. Corp. v One Beacon Ins. Y3d 708, 716 [2007]). This determination turns on consideration of the purpose was intended to serve as evidenced by both its stated coverage . . . as well as the its provision concerning excess insurance (Bovis Lend Lease LMB, Inc. v Great 0,53 AD3d 140, 148 [ l s t Dept 20081, quoting State Farm Fire & Cas. Co. v LiMauro, ective argues that comparison of the specific language of the subject policies tes that Plaza s additional insured coverage under the American policy should be ry, with the additional insured coverage under the Selective policy being excess utory. In support of this argument, Selective puts forth that the Selective policy co-insurance, in that it provides for a method of sharing additional insured both policies are primary. On the otMr hand, the American policy s ured endorsement states that [aJs respects coverage afforded by the Additional insurance is primary and noncontributory, and our obligations are not affected by urance carried by such Additional Insured whether primary, excess, contingent or basis (Notice of Motion, exhibit E, American policy, American policy additional rsement number 7). ever, Selective has misinterpreted the language of the American policy s additional orsement. In fact, a close review of the American policy s additional insured t reveals that the subject provision actually refers to coverage afforded by the sured, and that American s obligations are not to be affected by any other Page 8 of 11 [* 9] carried by such Additional Insured, clearly meaning that American s obligations are cted by any other insurance carried by Plaza itself, the putative additional insured. e, the issue is not whether the American and Selective policies have priority of vis-a-vis an insurance policy carried by Plaza, but rather, whether the American rage to Plaza on a primary basis, or the Selective policy, which may ge to Plaza on a primary basis, has priority of coverage in the event that Plaza is the underlying action. re the same risk is covered by two or more policies, each of which is sold to verage . . ., priority of coverage . . . among the policies is y comparison of their respective other insurance clauses (Sport Rock Intl., lnc. v s. Co. of Reading, Pa., 65 AD3d 12, 18 [Ist Dept 20091; Jefferson Ins. Co. of N. Y. Y2d 363, 372 [1998]). To that effect. when deciding which policies cess, courts will examine the language of the various other erican policy contains an [olther [i]nsurance clause which is at one contained in the Selective policy. These [olther [ilnsurance clauses he policies are to be considered primary, and, if the other insurance policy at issue coverage obligation is to be shared between the two policies. ifically, the [olther [ilnsurance clauses contained in the Selective and American state, in pertinent part, as follows: ERCIAL GENERAL LIABILITY CONDITIONS Other Insurance valid and collectible insurance is available to the insured for a loss we nder Coverages A or B of this Coverage Part, our obligations are limited /- Primary Insurance nsurance is primary except when b. below applies. If this insurance is Page 9 of 11 [* 10] ary, our obligations are not affected unless any of the other insurance is also ary. Then, we will share with all that other insurance by the method scribed in c. below. * * * Method of Sharing other insurance permits contribution by equal shares, we will follow this od also. Under this approach each insurer contributes equal amounts until paid its applicable limits of insurance or none of the loss remains, ever comes first. C. of the other insurance does not permit contribution by equal shares, we will tribute by limits. Under this method, each insurer s share is based on the io of its applicable limit of insurance to the total applicable limits of insurance II insurer (Notice of Motion, exhibit G, section IV - Commercial Liability ns, 4. Other Insurance; and exhibit E, American policy, section IV ns, 6. Other Insurance). efore, to the extent that it is determined that Selective and American owe additional e to Plaza on behalf of their named insureds, pursuant to the identical [olther lauses contained in the Selective and American policies, each insurer would be / ontribute on a co-primary basis, with each insurer contributing equal amounts until s paid its applicable limits of insurance or none of the loss remains, whichever elective is not entitled to conditional summary judgment declaring that, should a he underlying action render a factual determination that the accident arose out merican s named insured, Tri-State, then American must provide plaintiff d insured, Plaza, with a defense and indemnification on a primary and non- contrary to American s argument, Selective s motion for declarative judgment ed on the ground that it is premature. In support of this argument, American case of McLean v 405 Webster Ave. Assoc. (28 Misc. 3d 1219[A], *27 [Sup Ct, 20101, afld 98 AD3d 1090 [2d Dept 2012]), wherein the court declined to issue a to the priority of coverage as to certain policies [uJntila determination [was] Page 10 of 11 [* 11] , hether or not the National Grange policy affords coverage to 405 Webster (id.). es that, likewise, in this matter, until a determination is made as to whether or not and American policies owe additional insured coverage to Plaza, in the first place, the priority of coverage would be premature. ver, the facts of the McLean case can be easily distinguished from the facts of the In finding that a determination regarding the issue of primary and excess coverage e, the McLean court considered that 405 Webster s liability carrier was not yet a g that it should be prior to any ruling on the priority of coverage (id.). this case, Selective and American are both parties to the subject action. CONCLUSION e foregoing reasons, it is hereby RED that defendant Selective Insurance Company of New York s motion, PLR 3212(a), for conditional summary judgment, is denied; and it is further, RED that defendant Selective Insurance Company of New York is directed to of this Order with Notice of Entry upon all parties, within 45 days of entry. . FINAL DISPOSITION eck if appropriate: u DO NOT POST Page 11 of 11 NON-FINAL DISPOSITION E1 REFERENCE

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