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St. Paul Mercury Insurance Co. v. M&T Bank Corporation

United States District Court, S.D. New York

April 11, 2014

ST. PAUL MERCURY INSURANCE COMPANY, Plaintiff,
v.
M&T BANK CORPORATION, Defendant. M&T BANK CORPORATION, Third-Party Plaintiff,
v.
THEODORE LIFTMAN INSURANCE, INC., Third-Party Defendant.

Richard S. Mills, McELROY, DEUTSCH, MULVANEY & CARPENTER, LLP for St. Paul Mercury Insurance Company.

Robert J. Lane, Jr., HODGSON RUSS LLP, for M&T Bank Corporation.

John F.X. Lawler, ADLER POLLOCK & SHEEHAN P.C., for Theodore Liftman Insurance, Inc.

OPINION & ORDER

JOHN F. KEENAN, District Judge.

By Opinion and Order dated February 19, 2014, this Court granted summary judgment for Plaintiff St. Paul Mercury Insurance Company and Third-Party Defendant Theodore Liftman Insurance, Inc. against Defendant and Third-Party Plaintiff M&T Bank Corporation. This Opinion resolves the parties' dispute over the attorney's fees and costs owed to St. Paul by M&T Bank.

I. Background

The Court presumes familiarity with the facts of this litigation, which are fully set forth in its February 19 Opinion. See St. Paul Mercury Ins. Co. v. M&T Bank Corp., No. 12 Civ. 6322, 2014 WL 641438 (S.D.N.Y. Feb. 19, 2014). Briefly stated, Plaintiff St. Paul Mercury Insurance Company ("St. Paul") brought the instant action against Defendant and Third-Party Plaintiff M&T Bank ("M&T Bank" or "the Bank") for indemnification on the basis of a June 24, 2008 General Contract of Indemnity (the "GCI") between the parties. M&T Bank later filed a third-party complaint against Third-Party Defendant Theodore Liftman Insurance, Inc. ("Liftman"), seeking indemnification or contribution for any judgment won by St. Paul. Ultimately, the Court determined that the GCI was enforceable against the Bank, such that it must reimburse St. Paul for monies St. Paul paid out under a bond included in the GCI.

St. Paul also moved for attorney's fees and court costs as part of its summary judgment motion. The Court ruled as follows:

"Under the general rule in New York, attorneys' fees are the ordinary incidents of litigation and may not be awarded to the prevailing party unless authorized by agreement between the parties, statute, or court rule." Oscar Gruss & Son, Inc. v. Hollander , 337 F.3d 186, 199 (2d Cir. 2003). Here, St. Paul relies on a provision of the GCI that states M&T Bank's promise to "indemnify and exonerate [St. Paul] from and against any and all loss, cost and expense of whatever kind which it may incur or sustain as a result of... the enforcement of this Agreement, including unpaid premiums, interest, court costs and counsel fees." (Aug. 23, 2013 Mills Dec. Ex. A.) This provision makes "unmistakably clear" the parties' intention to shift the responsibility for St. Paul's court costs and attorney's fees to M&T Bank in the event of the latter's breach. Hooper Assocs., Ltd. v. AGS Computers, Inc. , 74 N.Y.2d 487, 492 (1989). M&T Bank does not argue to the contrary. See L&L Wings, Inc. v. Marco-Destin Inc. , 756 F.Supp.2d 359, 368 (S.D.N.Y. 2010). Accordingly, St. Paul's motion is granted. Within fourteen days of the date of this Opinion, St. Paul is directed to submit records demonstrating its costs and fees in this matter, including the date, the hours expended, and the nature of the work done by each attorney. Any response by M&T Bank must be submitted no later than fourteen days thereafter.

St. Paul Mercury Ins. Co., 2014 WL 641438, at *11.

On March 5, 2014, counsel for St. Paul submitted a declaration supporting its application. According to this declaration, St. Paul seeks:

(1) indemnification, as discussed, in the amount of $868, 995.26;
(2) pre-judgment interest on the amount to be indemnified, totaling $172, 620.39;
(3) reimbursement for attorney's fees incurred by counsel for St. Paul, the law firm McElroy, Deutsch, Mulvaney & Carpenter, LLP ...

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