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West New York Restoration of Ct, Inc. v. RLI Insurance Co.

United States District Court, S.D. New York

March 14, 2014



ANDREW L. CARTER, Jr., District Judge.

Defendants RLI Insurance Company ("RLI") and American States Insurance Company ("American States") bring separate motions for summary judgment seeking dismissal of the complaint brought by Plaintiff West New York Restoration of Connecticut ("West NY"). For the reasons below, RLI's motion (Dkt. No. 29) is granted and American States' motion (Dkt. No. 23) is denied.


I. The Underlying Incident

On November 6, 2009, then-West NY employee Sebastian Kiszewski was allegedly injured in the course of his employment at a property owned by 1800 Boston Road LLC ("1800 Boston Road"), in which West NY was a tenant and conducted at least some of its operations. After going to the emergency room, Kiszewski returned to work later the same day and worked at West NY until November 20, 2009. In a December 22, 2009 letter, Alfred Gallicchio, president of West NY, contended that Kiszewski did not return to work because Kiszewski had an invalid social security number. (Declaration of Timothy Delahunt ("Delahunt Decl.") Ex. 6). Kiszewski did not immediately report serious injury or file suit. A workers' compensation form was filled out on November 30, 2009 on Kiszewski's behalf by Marie Baez, an executive secretary at West NY. (Delahunt Decl. Ex. 7). However, in October 2010, Kiszewski filed a complaint in Bronx Supreme Court.[1] (See Delahunt Decl. Decl. Ex. 2). In December 2010, Kiszewski filed an amended complaint adding 1800 Boston Road as a defendant. Neither Kiszewski's original nor his amended complaint name West NY as a defendant.

II. Third-Party Complaint

On April 17, 2012, 1800 Boston Road filed a third-party complaint against West NY in Bronx Supreme Court, seeking indemnification for West NY's "affirmative, active and primary" negligence and pursuant to the lease agreement by which West NY, as tenant, agreed to indemnify 1800 Boston Road LLC against claims in connection with any injury on or adjoining the property "arising directly or indirectly out of the business conducted on the premises" (Declaration of Craig Blumberg in Opposition to Defendant RLI Insurance Company's Motion for Summary Judgment ("Blumberg Decl.") Ex. A). The third-party complaint specifically alleged that Kiszewski "commenced an action for personal injuries to have been sustained through the negligence of the defendant/third party plaintiff, 1800 Boston Road, LLC, and the plaintiff alleges in substance that on November 6, 2009 he was caused to sustain personal injuries while unloading a truck at 1800 Boston Road, Bronx, New York." (Id. ¶ 4).

At some time after the date of the incident and after Kiszewski's initial and amended complaint, but before the third-party complaint was filed, West NY sought coverage from Defendants. Specifically, West NY sought coverage from RLI on November 21, 2011 (RLI Rule 56.1 Stmt ¶ 12; Delahunt Decl. Ex. 9), and by letter dated December 16, 2011, RLI disclaimed coverage citing the auto exclusion and late notice, (RLI Rule 56.1 Stmt ¶ 13; Delahunt Decl. Ex. 10). American States contends that West NY did not provide notification of the claim until January 11, 2012 (American States Rule 56.1 Stmt ¶ 17; Affidavit of Peter Sealy ("Sealy Aff.") ¶ 7). By letter dated January 30, 2012, American disclaimed coverage for multiple reasons, including late notice, (id. ¶ 18; Sealy Aff. Ex. B). After these denials of coverage, West NY filed an action against Defendants in Bronx Supreme Court which was removed to this Court on July 16, 2012 (Dkt. No. 1). Neither Kiszewski nor Third-Party Plaintiff 1800 Boston Road are parties in this action.

III. The Policies

Both Defendants issued insurance policies to West NY effective for the policy period of December 31, 2008 through December 21, 2009 and subsequently denied requests for coverage from West NY for defense and indemnification. Specifically, RLI issued an excess general liability policy bearing policy number RLO0001845 ("RLI Policy"). (RLI Rule 56.1 Stmt ¶ 1). American States issued a commercial automobile insurance policy bearing policy number 01-CH-293841-3 ("American States Policy"). (American States Rule 56.1 Statement ¶ 15). Both policies required West NY to notify the insurer of any claims within a reasonable time. (RLI Rule 56.1 Stmt ¶ 9; Delahunt Decl. Ex. 1, RLI Policy § VII(5) ("[Insured] must see to it that we are notified as soon as practicable of an occurrence or an offense which may result in a claim under this policy."); American States Rule 56.1 Stmt ¶ 16; Sealy Aff. ¶ 6 & Ex. A, American States Policy § IV(A)(2) ("We have no duty to provide coverage under this policy if the failure to comply with the following duties is prejudicial to us: in the event of "accident", claim, "suit" or "loss", you or someone on your behalf must give us or our authorized representative notice as soon as reasonably possible of the "accident" or "loss.")).

The RLI Policy also included an auto exclusion that the policy would not apply to "[b]odily injury or property damage arising out of the ownership, maintenance, use or entrustment to others of any... auto... owned or operated by or rented or loaned to any insured. Use includes operation and loading or unloading." (RLI Rule 56.1 Stmt ¶ 9; Delahunt Decl. Ex. 1, RLI Policy § III(i)). "Loading or unloading" is separately defined as "the handling of property:

a. After it is moved from the place where it is accepted for movement into or onto an... auto;
b. While it is in or on an... auto; or
c. While it is being moved from an... auto to the place where it is ...

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