Opinion
11372 Index 112533/11 590928/13
04-09-2020
LEXINGTON INSURANCE COMPANY as subrogee of Prime Alliance Group Ltd., et al., Plaintiffs, v. KISKA DEVELOPMENT GROUP LLC, et al., Defendants–Respondents–Appellants, Bayport Construction Corp., Defendant–Respondent. Kiska Development Group LLC, et al., Third–Party Plaintiffs–Respondents– Appellants, v. Mt. Hawley Insurance Company, Third–Party Defendant–Appellant– Respondent.
Delahunt Law PLLC, Buffalo (Timothy E. Delahunt of counsel), for appellant-respondent. Kennedys, New York (Ann M. Odelson of counsel), for respondents—appellants. Baker Greenspan & Bernstein, Bellmore (Robert L. Bernstein, Jr. of counsel), for respondent.
Delahunt Law PLLC, Buffalo (Timothy E. Delahunt of counsel), for appellant-respondent.
Kennedys, New York (Ann M. Odelson of counsel), for respondents—appellants.
Baker Greenspan & Bernstein, Bellmore (Robert L. Bernstein, Jr. of counsel), for respondent.
Friedman, J.P., Kapnick, Webber, Gonza´lez,JJ.
Order, Supreme Court, New York County (Gerald Lebovits, J.), entered October 31, 2018, which, insofar as appealed from as limited by the briefs, denied defendants/third-party plaintiffs Kiska Development Group LLC and 14 West 14 LLC's motion for summary judgment on their claim against defendant Bayport Construction Corp. for contractual indemnification, denied the motion for summary judgment on their claim that Kiska is an additional insured under the policy issued to Bayport by third-party defendant (Mt.Hawley), granted Mt. Hawley's cross motion for summary judgment declaring that Kiska is not an additional insured, and denied the motion for summary judgment dismissing 14 West's claim that it is an additional insured, unanimously modified, on the law, to declare that Mt. Hawley is obligated at this stage merely to defend 14 West, as opposed to indemnifying it, and otherwise affirmed, without costs.
Kiska is not an additional insured under the policy that Mt. Hawley issued to Bayport, because the contract between Kiska and Bayport lacks the requisite "express and specific language requiring that [Kiska] be named as an additional insured" ( Clavin v. CAP Equip. Leasing Corp., 156 A.D.3d 404, 405, 66 N.Y.S.3d 470 [1st Dept. 2017] ). The contract required Bayport to procure insurance naming 14 West as an additional insured, but it only required Kiska to be a Certificate Holder, and the Certificate states that it "does not amend, extend or alter the coverage afforded by the [policy]" (see Three Boroughs, LLC v. Endurance Am. Specialty Ins. Co., 143 A.D.3d 480, 481, 38 N.Y.S.3d 421 [1st Dept. 2016] ; see also West 64th St., LLC v. Axis U.S. Ins., 63 A.D.3d 471, 472, 882 N.Y.S.2d 22 [1st Dept. 2009] ; Illinois Natl. Ins. Co. v. American Alternative Ins. Corp., 58 A.D.3d 537, 538, 872 N.Y.S.2d 26 [1st Dept. 2009] ; Moleon v. Kreisler Borg Florman Gen. Constr. Co., 304 A.D.2d 337, 339, 758 N.Y.S.2d 621 [1st Dept. 2003] ).
The provision of the Kiska–Bayport contract that says Kiska may retain monies due to Bayport "until all ... suits or claims, actions or proceedings for damages ... shall have been settled or determined, unless [Bayport] presents ... evidence satisfactory to [Kiska] of adequate insurance ... covering [Kiska] ... as additional insured" does not require Bayport to procure additional insured coverage for Kiska (see Clavin, 156 A.D.3d at 405, 66 N.Y.S.3d 470 ).
Kiska cites various provisions of its contract with Bayport that require Bayport to indemnify it. However, as Kiska itself says, entitlement to additional insured status and contractual indemnification are distinct.
Kiska contends that its contract with Bayport incorporated by reference the main contract between Kiska and 14 West and that the main contract requires Bayport to name Kiska as an additional insured. However, it provides no record support for these claims. In any event, a general provision incorporating the Kiska–14 West contract by reference would not require Bayport to procure additional insured coverage for Kiska (see e.g. Betancur v. Lincoln Ctr. for the Performing Arts, Inc., 101 A.D.3d 429, 430, 956 N.Y.S.2d 7 [1st Dept. 2012] ; Bussanich v. 310 E. 55th St. Tenants, 282 A.D.2d 243, 244, 723 N.Y.S.2d 444 [1st Dept. 2001] ). Mt. Hawley concedes that 14 West is an additional insured under the policy that it issued to Bayport, but it contends that 14 West's claim is academic because 14 West is already receiving defense and indemnity from third-party plaintiff New York Marine and General Insurance Company (Kiska's insurer). This argument is unavailing. The New York Marine policy (under which 14 West is an additional insured) is excess to Mt. Hawley's policy (under which 14 West is also an additional insured). Therefore, Mt. Hawley—not New York Marine—should be defending 14 West in the main action.
Mt. Hawley is correct, however, that it was premature to declare that it was obligated to indemnify (as opposed to defend) 14 West (see Mt. Hawley Ins. Co. v. American States Ins. Co., 168 A.D.3d 558, 559, 92 N.Y.S.3d 238 [1st Dept. 2019] ; Greenwich Ins. Co. v. City of New York, 139 A.D.3d 615, 34 N.Y.S.3d 408 [1st Dept. 2016] ). Mt. Hawley's policy affords coverage to additional insureds "only with respect to liability for ... ‘property damage’ ... caused, in whole or in part, by ... [Bayport's] acts or omissions." This means coverage for property damage proximately caused by Bayport ( Burlington Ins. Co. v. NYC Tr. Auth., 29 N.Y.3d 313, 57 N.Y.S.3d 85, 79 N.E.3d 477 [2017] ). It has not yet been determined whether Bayport was the proximate cause of the collapse of the wall.
We affirm, on other grounds, the denial of 14 West's motion for summary judgment on its claim against Bayport for contractual indemnification. With respect to 14 West (as opposed to Kiska), there are no issues of fact; 14 West simply is not entitled to contractual indemnification from Bayport, because the contract between Kiska and Bayport does not say that Bayport must indemnify 14 West (see Trawally v. City of New York, 137 A.D.3d 492, 492–493, 27 N.Y.S.3d 505 [1st Dept. 2016] ).
As for Kiska's summary judgment motion against Bayport, the contract between them requires Bayport to indemnify Kiska for claims arising out of Bayport's negligent acts or omissions or breaches of contract, and it has not yet been determined whether Bayport was negligent or breached the contract (see Trawally, 137 A.D.3d at 493, 27 N.Y.S.3d 505 ). In addition, the contract provides for indemnification for Kiska only to the extent the claim is not caused by Kiska's negligence, and Kiska has not established that it was free from negligence (see Correia v. Professional Data Mgt., 259 A.D.2d 60, 65, 693 N.Y.S.2d 596 [1st Dept. 1999] ; Matthews v. Trump 767 Fifth Ave., LLC, 50 A.D.3d 486, 487, 858 N.Y.S.2d 20 [1st Dept. 2008] ).