[*1]
Daley v 250 Park Ave., LLC
2014 NY Slip Op 51101(U) [44 Misc 3d 1212(A)]
Decided on July 22, 2014
Supreme Court, Kings County
Rivera, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on July 22, 2014
Supreme Court, Kings County


Denzil Daley AND CAROLINE DALEY, Plaintiff,

against

250 Park Avenue, LLC, ANHEUSER-BUSCH, INC. D/B/A BUDWEISER and NUCOR CONSTRUCTION CORPORATION, Defendants.




31894/09



Hoey, King, Epstein, Prezioso & Marquez
Attorney for Defendant/Third Party Plaintiff
250 Park Avenue, LLC.
Office and Post Office Address
55 Water Street, 29th Floor
New York, New York 10041-2899
(212) 612-4200

Ginsberg & Wolf, P.C.
Attorneys for Plaintiffs,
Denzil Daley and Caroline Daley
225 Broadway, Suite 3105
New York, New York 10007

Borchert, Genovesi, LaSpina & Landicino P.C.
Attorneys for Defendants,
Anheuser-Bush, Inc. d/b/a Budweiser and Nucor Construction Corporation
19-02 Whitestone Expy, Suite 302
Whitestone, New York 11357

Francois A. Rivera, J.

On August 22, 2009, plaintiffs Denzel Daley (hereinafter the injured plaintiff) and his wife Caroline Daley, suing derivatively, commenced the instant action for personal injuries and derivative claims by filing a summons and complaint with the Kings County Clerk's office (hereinafter KCCO). On September 24, 2012, 250 Park Avenue joined issue and asserted cross claims against Budweiser and Nucor for contribution, common law and contractual indemnification, and breach of contract for failure to procure insurance. By answer dated May 28, 2013, Budweiser joined issue and asserted counterclaims against 250 Park Avenue for apportionment, contribution and indemnification. A note of issue was filed February 28, 2013.

On February 11, 2013, 250 Park Avenue commenced the third party complaint against Budweiser for contractual indemnification, breach of contract, common and contractual indemnification by filing a summons and complaint with the Kings County Clerk's office (hereinafter KCCO) under index number 7515/13.

On May 17, 2013, 250 Park Avenue commenced the second third party complaint against Inbev for contractual indemnification, breach of contract, common and contractual indemnification by filing a summons and complaint with the KCCO under index number 75331/13. By answer dated August 8, 2013, Inbev joined issue and asserted counterclaims against 250 Park Avenue for apportionment, contribution, and indemnification.

The summons complaint and bill of particulars asserts that on August 28, 2009, the plaintiff was working at 250 Park Avenue, New York, New York as an employee of non-party Broadway Electric when he fell from his ladder, sustaining physical injuries. It is undisputed that 250 Park Avenue was the owner, and Inbev was a tenant of the premises pursuant to a written lease agreement dated May 21, 2009. Budweiser was the guarantor on the lease between Inbev and 250 Park Avenue.

LAW AND APPLICATION

It is well established that summary judgment may be granted only when it is clear that no triable issue of fact exists (Alvarez v Prospect Hospital, 68 NY2d 320 [1986]). The burden is upon the moving party to make a prima facie showing that he or she is entitled to summary judgment as a matter of law by presenting evidence in admissible form demonstrating the absence of any material facts (Giuffrida v Citibank, 100 NY2d 72 [2003]). The prima facie showing which a defendant must make on a motion for summary judgment is governed by the allegations of liability made by the plaintiff in the pleadings (Miller v Village of E. Hampton, 98 AD3d 1007 [2nd Dept 2012] citing Foster v Herbert Slepoy Corp., 76 AD3d 210, 214 [2nd Dept 2010]). A failure to make that showing requires the denial of that summary judgment motion, regardless of the adequacy of the opposing papers (Ayotte v Gervasio, 81 NY2d 923 [1993]). If a prima facie showing has been made the burden shifts to the opposing party to produce evidentiary proof sufficient to establish the existence of material issues of fact (Alvarez v Prospect Hospital, 68 NY2d 320 at 324 [1986]).

A party opposing a motion for summary judgment is obligated "to lay bear his proofs" to sufficiently demonstrate, with admissible evidence, that a triable issue of fact will exist (Friends of Animals, Inc. v Associated for Manufacturers, Inc., 46 NY2d 1065 [1979]). A genuine issue of fact may not be demonstrated by using mere conclusions, expressions of hope or unsubstantiated allegations or assertions (Amatulli v Delhi Constr. Corp., 77 NY2d 525 [1991]).


250 Park Avenue's Motion for Conditional Summary Judgment on the Contractual Indemnification

The right to contractual indemnification depends upon the specific language of the contract (Martinez v City of New York, 73 AD3d 993 [2nd Dept 2010] citing George v Marshalls of MA, Inc., 61 AD3d 925, 930 [2nd Dept 2009]). It is well established that when a party is under no legal duty to indemnify a contract assuming that obligation must be strictly construed to avoid reading into it a duty which the parties did not intend to be assumed (Hooper Assocs. v AGS Computers, 74 NY2d 487, 491 [1981]) "[A] party who has been held liable to an injured worker solely on the basis of the statutory liability imposed by section 240 (1), without any fault on its part, is entitled to recover under a contract of indemnity" (Bermejo v New York City Health and Hospitals Corp., — NYS2d —, 2014 WL 2958200 [2nd Dept 2014]). Further, parties may agree to an indemnification clause that is not limited to claims arising out of the negligence of a party (see Tobio v Boston Props., Inc., 54 AD3d 1022, 1024; Simone v Liebherr Cranes, Inc ., 90 AD3d 1019; cf. Zastenchik v Knollwood Country Club, 101 AD3d 861; Cunha v City of New York, 45 AD3d 624, aff'd 12 NY3d 504; Moss v McDonald's Corp., 34 AD3d 656).

In the instant action, 250 Park Avenue seeks indemnification from Inbev pursuant to the lease agreement. The lease provides in section 20.02:

Tenant shall indemnify and hold harmless Landlord and its agents against and from (a) any and all claims(I) arising from (x) the conduct or management of the Demised Premises or of any business therein, (y) a breach by Tenant of his Lease or (z) any work or thing whatsoever done, or any condition created (other than by Landlord for Tenant's account) in or about the Demised Premises during the term of this Lease or during the period of time, if any, prior to the Commencement Date that Tenant may have been given access to the Demised Premises, or (ii) arising from any negligent or otherwise wrongful act of omission of Tenant or any of its subtenants or licensees or its or their employees, agents or contractors, and (b) all costs, expenses and liability incurred in or in connection with each such claim or action or proceeding brought thereon. If any action or proceeding is brought against Landlord by reason of any such claim, Tenant upon notice from Landlord, shall resist and defend such action or proceeding.

250 Park Avenue relies upon section "(a)(z)" of the indemnification provision in asserting that Inbev is required to indemnify it in situations such as the first party action. Section "(a)(z)" of the indemnification provision provides that Inbev is required to indemnify 250 Park Avenue regardless of whether Inbev has been found negligent. The language of the provision is broad and includes any and all claims arising out of work done at the premises. As the instant action is a claim that arose from the injured plaintiff performing work at the premises, section "(a)(z)" is triggered and Inbev has a duty to indemnify 250 Park Avenue. Accordingly, the burden switches to Inbev to raise a triable issue of fact.

In opposition to the motion Inbev basically asserts two arguments. The first position is that section "(a)(z)" of the indemnification provision is not triggered in instances such as the instant litigation as it is inapplicable to tort actions. Inbev asserts that only section "ii" applies to tort actions. Furthermore, section "ii" requires a finding of negligence on Inbev's part in order to trigger the obligation to indemnify. The second assertion is that the indemnification provision is void as it violates General Obligations Law § 5-321. As discussed above, the Court has already determined that section "(a)(z)" applies. Therefore the issue as to whether section "ii" applies in the instant scenario is superfluous.

However, it must be determined whether the applicable provision "(a)(z)" violates the General Obligations Law. That statute provides "every covenant, agreement or understanding in or in connection with or collateral to any lease of real property exempting the lessor from liability for damages for injuries to person or property caused by or resulting from the negligence of the lessor, his agents, servants or employees, in the operation or maintenance of the demised premises or the real property containing the demised premises shall be deemed to be void as against public policy and wholly unenforceable."

The statute's invalidation of agreements "exempting" lessors from liability for damages resulting from their own negligence "strongly suggests that [it] was directed [*2]primarily to exculpatory clauses in leases whereby lessors are excused from direct liability for otherwise valid claims which might be brought against them by others" (Great N. Ins. Co. v Interior Constr. Corp., 7 NY3d 412 [2006])(internal citations omitted). However, General Obligations Law § 5-321 has been held not to preclude a landlord's indemnification claim. Specifically, indemnification provisions in leases have been excepted from violating the GOL as the landlord is not actually exempting itself from liability to the victim for its own negligence. Rather, the parties are allocating the risk of liability to third parties between themselves, essentially through the employment of insurance (Id.). Accordingly, the indemnification provision does not violate the GOL and Inbev has failed to raise a triable issue of fact.


250 Park Avenue's Motion for Summary Judgment Against Budweiser Under the Guaranty

250 Park Avenue also moves for summary judgment in their favor as against Budweiser on a separate lease agreement which provides in pertinent part:

Guaranty. Guarantor hereby guaranteed, the full and timely performance and observance of all the covenants, terms and conditions of the Lease to be performed and observed by the Tenant including, without limitation, the payment when due of all fixed rent, additional rent and all other rents (as such terms are defined in the lease) and other sums (including without limitation, indemnification liability and reasonable attorney's fees) payable under the Lease. All payments made under this Guaranty shall be in the legal currency of the United States of America for payment of public and private debts.

A guaranty is to be interpreted in the strictest manner, particularly in favor of a private guarantor and cannot be altered without the guarantor's consent. Accordingly, a guarantor can not be bound beyond the express terms of his guarantee (see 665—75 Eleventh Ave. Realty Corp., 265 AD2d 270, at 271). The express language of the guarantee is clear and unambiguous and provides for Budweiser to guarantee the full performance of Inbev.

Accordingly, the burden switches to Budweiser to raise a triable issue of fact. In opposition Budweiser relies exclusively on the arguments outlined above as against the indemnification provisions. As the indemnification provision has been held valid and enforceable Budweiser fails to raise a triable issue of fact.


250 Park Avenue's Motion to Compel

250 Park Avenue's motion seeks the alternative relief of compelling Budweiser and Inbev to produce certified copies of their insurance policies.

22 NYCRR 202.7 provides:

(a) There shall be compliance with the procedures prescribed in the CPLR for the bringing of motions. In addition, except as provided in subdivision (d) of this section, no motion shall be filed with the court unless there have been served and filed with the motion papers (1) a notice of motion, and (2) with respect to a motion relating to disclosure or to a bill of particulars, an affirmation that counsel has conferred with counsel for the opposing party in [*3]a good faith effort to resolve the issues raised by the motion. (c) The affirmation of the good faith effort to resolve the issues raised by the motion shall indicate the time, place and nature of the consultation and the issues discussed and any resolutions, or shall indicate good cause why no such conferral with counsel for opposing parties was held.

In support of this portion of the motion 250 Park Avenue includes notice for discovery and inspection dated October 23, 2012, which requests production of the insurance policies. 250 Park Avenue does not include an affirmation of good faith which outlines the efforts taken by counsel to resolve this discovery dispute. Accordingly, the motion is denied without prejudice for failing to comply with 22 NYCRR 202.7.

Budweiser and Inbev's Summary Judgment Motion to Dismiss the Third Party Actions

Budweiser and Inbev move for summary judgment to dismiss the third party claims asserted against them by 250 Park Avenue. The motions are based on the same assertions as the opposition to 250 Park Avenue's motion. As discussed above, neither Inbev nor Budweiser raised a genuine issue of material fact in opposition to 250 Park Avenue's motion. Accordingly, their motions must be denied.

Budweiser and Inbev's Summary Judgment Motion on their Respective Counterclaims

Budweiser and Inbev have also moved pursuant to CPLR 3212 for summary judgment on their causes of action for apportionment, contribution and common law indemnification asserted in the third-party actions. By order dated January 29, 2013, 250 Park Avenue has been found negligent pursuant to Labor Law 240(1). There has been no finding as to the negligence of Inbev or Budweiser.

A cause of action for contribution requires that the culpable parties must be subject to liability for damages for the same personal injury (Nassau Roofing & Sheet Metal v Facilities Development Corporation, 71 NY2d 599 [1988]). The parties need not be liable under the same theories or whether the party whom contribution is sought is allegedly responsible fo the injury as a "concurrent, successive, independent, alternative or even intentional tort-feasor" (Id.) Contribution is not founded upon, nor does it necessarily arise from, contract, and only a ratable or proportional reimbursement is sought (McDermott v. City of New York, 50 NY2d 211[1980]; McFall v. Compagnie Maritime Belge S.A., 304 NY 314 [1952]; Fox v. County of Nassau, 183 AD2d 746 [2d Dep't 1992]. Where a party is held liable at least partially because of its own negligence, contribution against other culpable tort-feasors is the only available remedy" (Fox v. County of Nassau, 183 AD2d 746 [2d Dep't 1992]). Similarly, a claim for apportionment exists when two or more tortfeasors combine to cause an injury, the resulting loss is to be split among them according to their comparative degrees of fault (Dole v. Dow Chem. Co., 30 NY2d 143 [1972]. Conversely, common-law indemnity requires vicarious liability without actual fault on the part of the proposed indemnitee. (Rehberger v. Garguilo & Orzechowski, LLP, 118 AD3d 767 [2d Dept 2014]).Common law indemnification requires that only one party, the indemnitor be at fault in the causing of [*4]the accident. Accordingly, it is impossible to simultaneously be entitled to common law indemnification and also be entitled to contribution and apportionment.

Furthermore, claims for apportionment and contribution accrue not as of the date of the tort with respect to which contribution is sought, but only when the liability of the party seeking contribution is established. Moreover, similar to indemnification a claim for apportionment of damages does not generally accrue until payment is made by the party seeking apportionment. Thus, a contribution claim accrues not upon the date that judgment is entered but upon the date of its payment (Bay Ridge Air Rights, Inc. v. State, 44 NY2d 49 (1978); Scaccia v. Wallin, 121 AD2d 709 (2d Dep't 1986)].

In light of the of Inbev and Budweiser not yet being determined as liable the Court cannot determine whether which, if any, of the claims are appropriate. Accordingly, that portion of Inbev and Budweiser's motion for summary judgment on the counterclaims is denied due to its prematurity without prejudice to renew.

CONCLUSION

250 Park Avenue's motion seeking conditional summary judgment on its contractual indemnification claim against Inbev is granted.

250 Park Avenue's motion seeking conditional summary judgment on its guarantee claim against Budweiser is granted.

250 Park Avenue's motion to compel is denied without prejudice.

Budweiser's motion pursuant to CPLR 3212 for summary judgment on the counterclaims asserted against 250 park Avenue in the third party complaint is denied without prejudice.

Inbev's motion pursuant to CPLR 3212 for summary judgment on the counterclaims asserted against 250 park Avenue in the second third party complaint is denied without prejudice.

Budweiser's motion seeking to dismiss the causes of action asserted against it in the third party complaint by 250 Park Avenue is denied.

Inbev's motion seeking to dismiss the causes of action asserted against it in the second third party complaint by 250 Park Avenue is denied.

The foregoing constitutes the decision and order of this Court.Enter:

J.S.C.