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TRAVELERS INDEMNITY CO. OF CONN. v. THE LOSCO GROUP

May 2, 2002

TRAVELERS INDEMNITY COMPANY OF CONNECTICUT A/S/O THE GERMAN SCHOOL OF NEW YORK, PLAINTIFF,
V.
THE LOSCO GROUP, INC., PACIFIC IRON WORKS, INC., FAIRWAY TESTING CO., INC., AND PETER ENGLERT & ASSOCIATES, INC., DEFENDANTS.



The opinion of the court was delivered by: McMAHON, U.S.D.J.

 
MEMORANDUM DECISION AND ORDER DENYING THE LOSCO GROUP'S MOTION FOR SUMMARY JUDGMENT AND GRANTING FAIRWAY TESTING'S MOTIONS FOR SUMMARY JUDGMENT

Plaintiff Travelers Indemnity Company of Connecticut ("Travelers") brought a subrogation action for negligence and gross negligence against The Losco Group, Inc. ("Losco"), Pacific Iron Works, Inc. ("Pacific Iron Works"), Fairway Testing Co., Inc. ("Fairway Testing"), and Peter Englert & Associates, Inc. ("Englert"), and an additional action for breach of contract against Englert, on behalf of its insured, The German School of New York ("the School"), arising out of a collapse of a steel truss during the construction of a gymnasium at the School. The breach of contract claim against Englert was previously dismissed by this Court pursuant to Fed. R. Civ. P. 12(b)(6) and Travelers voluntarily withdrew its claim of negligence against Englert. Defendants Losco and Fairway Testing move for summary judgment pursuant to Fed. R. Civ. P. 56 on the negligence and gross negligence claims against them.

For the reasons stated below, Losco's motion for summary judgment is denied and Fairway Testing's motion for summary judgment is granted.

FACTUAL BACKGROUND

The German School is a private school located in White Plains, New York. On or about November 22, 1995, the School entered into an agreement with Englert whereby Englert agreed to provide architectural services in connection with the construction of a gymnasium on the premises of the School (the "Englert Agreement"). The terms of this contract contained a waiver of subrogation with respect to damages covered by property insurance. This waiver was not limited to the parties to the contract; the waiver extended to all contractors, consultants, agents or employees of either Englert or the German School. Maher Aff. ¶ 5. The waiver provision states:

The Owner and the Architect waive all rights against each other and against the contractors, consultants, agents and employees of the other for damages, but only to the extent covered by property insurance during construction, except such rights as they may have to the proceeds of such insurance as set forth in the edition of AIA Document A201, General Conditions of the Contract for Construction, current as of the date of this Agreement. The Owner and Architect each shall require similar waivers from their contractors, consultants and agents.

Englert Agreement at ¶ 9.4.

On or about July 23, 1997, the School entered into an agreement with Losco whereby Losco agreed to provide certain construction services in connection with the construction of the School's gymnasium (the "Losco Agreement"). Incorporated into the Losco Agreement are American Institute of Architects general conditions, including a "Waivers of Subrogation" provision. This provision states:

Losco Agreement at ¶ 11.3.7. In addition, the Losco Agreement provided that:

Property insurance shall be on an all-risk policy form and shall insure against the perils of fire and extended coverage and physical loss or damage including, without duplication of coverage, theft, vandalism, malicious mischief, collapse, falsework, temporary buildings and debris removal including demolition occasioned by enforcement of any applicable legal requirements, and shall cover reasonable compensation for Architect's services and expenses required as a result of such insured loss. Coverage for other perils shall not be required unless otherwise provided in the Contract Documents.

Losco Agreement at ¶ 11.3.1.1.

On or about January 20, 1998, the School took out a builder's risk insurance policy issued by Travelers, which covered the construction of the gymnasium on the premises of the School.

During the construction of the gymnasium, Fairway Testing, pursuant to an oral agreement with Englert, performed inspection and testing services at the School. Pursuant to the oral agreement, Fairway agreed to supply inspection and testing services on an "as needed basis," if and when they were contacted during the course of the project. See Maher Aff. ΒΆ 6, Ex. B (Aguanno Dep. At 14-15, 22). At that time it was also agreed if Fairway Testing performed inspection and testing ...


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