Hardin, Kundla, McKeon & Poletto, New York (George R.
Hardin of counsel), for appellant.
McMahon, Martine & Gallagher, LLP, Brooklyn (Kristina
Scotto of counsel), for the City of New York, New York City
Transit Authority and the Metropolitan Transportation
Clausen Miller, P.C., New York (Don R. Sampen of the State of
Illinois, admitted pro hac vice, of counsel), for the
Evanston Insurance Company, respondent.
Friedman, J.P., Tom, Mazzarelli, Singh, JJ.
and judgment (one paper), Supreme Court, New York County
(Michael D. Stallman, J.), entered May 20, 2016, declaring
that third-party defendant Liberty Insurance Underwriters
Inc. is obligated to defend and indemnify
defendants/third-party plaintiffs City of New York, New York
City Transit Authority, and Metropolitan Transit Authority
(the City defendants) in the underlying personal injury
action, unanimously modified, on the law, to delete, without
prejudice, the declaration that Liberty is obligated to
indemnify the City defendants, and otherwise affirmed,
without costs. Appeal from order, same court and Justice,
entered January 15, 2016, unanimously dismissed, without
costs, as subsumed in the appeal from the judgment. Order,
same court and Justice, entered on or about May 26, 2016,
which, insofar as appealed from, upon renewal, adhered to the
original determination, unanimously modified, on the law, to
delete, without prejudice, the declaration that Liberty is
obligated to indemnify the City defendants, and otherwise
affirmed, without costs.
City defendants contracted with defendant E.E. Cruz &
Tully Construction Co., a Joint Venture, LLC (Joint Venture).
In turn, the Joint Venture entered into a subcontract with
defendant/third-party defendant L & L Painting Co., Inc.
The subcontract required L & L to procure insurance
naming the Joint Venture and the City defendants as
issued a commercial general liability insurance policy to L
& L. Endorsements 1-3 provide, in pertinent part, that an
additional insured is someone "required by written
contract signed by both parties prior to any occurrence'
in which coverage is sought." By contrast, endorsement 4
says that an additional insured is "any person or
organization with whom you [L & L] have agreed to add as
an additional insured by written contract."
argues that the City defendants are not additional insureds
because it had no contract with them. If endorsement 4 were
the only additional insured endorsement, Liberty would be
correct (see Gilbane Bldg. Co./TDX Constr. Corp. v St.
Paul Fire & Mar. Ins. Co., 143 A.D.3d 146, 147-148,
151 [1st Dept 2016]). However, a contract between Liberty and
the City defendants is not required under endorsements 1-3
(see Netherlands Ins. Co. v Endurance Am. Speciality Ins.
Co., ___ A.D.3d __, 2018 NY Slip Op 00105 [1st Dept,
Jan. 9, 2018]).
also argues that the City defendants are not additional
insureds because plaintiff Robert Vargas's injury was not
caused by L & L or those acting on its behalf, as
required by endorsements 1-3. The limitations in endorsements
1-3 do not vitiate Liberty's duty to defend, because the
second amended complaint brings the insurance claim at least
"potentially within the protection purchased"
(BP A.C. Corp. v One Beacon Ins. Group, 8 N.Y.3d
708, 714  [internal quotation marks omitted]). The
second amended complaint alleges that all defendants
- which includes L & L - operated, maintained, managed,
and controlled the job site. It also alleges that all
defendants were negligent and failed to provide a safe job
site. Thus, it is possible that plaintiff's injury was
caused by L & L.
it was premature to declare that Liberty is obliged to
indemnify the City defendants. The duty to defend is
broader than the duty to indemnify (see e.g. id.).
It has not yet been determined if L & L was the proximate
cause of plaintiff's injury (see Burlington Ins. Co.
v NYC Tr. Auth., 29 N.Y.3d 313');">29 N.Y.3d 313 ).
the City defendants did not ask the motion court to declare
that Liberty was required to defend and indemnify them, it is
not entirely clear why it did so. If the court based its
decision on its finding that Liberty's disclaimer was
untimely, this was error: A late disclaimer would not
preclude Liberty from arguing that the City defendants were
not covered under the policy because they were not additional
insureds (see George Campbell Painting v National Union
Fire Ins. Co. of Pittsburgh, PA, 92 A.D.3d 104, 112 and
n 5 [1st Dept 2012]; see also Agoado Realty Corp. v
United Intl. Ins. Co., 260 A.D.2d 112, 115 [1st Dept
1999]), mod on other grounds 95 N.Y.2d 141');">95 N.Y.2d 141 ;
National Gen. Ins. Co. v Hartford Acc. & Indem.
Co., 196 A.D.2d 414, 416 [1st Dept 1993]).
timeliness of Liberty's disclaimer is relevant to whether
it can assert the lead exclusion (see Agoado Realty Corp.
v United Intl. Ins. Co., 95 N.Y.2d 141');">95 N.Y.2d 141, 146 n * )
and the defense that the City defendants' notice was late
(see Travelers Ins. Co. v Volmar Constr. Co., 300
A.D.2d 40, 44 [1st Dept 2002] [notice requirement applies
equally to both primary and additional insureds]). The motion
court correctly found as a matter of law that Liberty's
45-day delay in disclaiming was untimely (see Bovis Lend
Lease LMB, Inc. v Royal Surplus Lines Ins. Co., 27
A.D.3d 84, 88-89 [1st Dept 2005]; West 16th St. Tenants
Corp. v Public Serv. Mut. Ins. Co., 290 A.D.2d 278');">290 A.D.2d 278 [1st
Dept 2002], lv denied 98 N.Y.2d 605');">98 N.Y.2d 605 ).
Plaintiff commenced this action on May 9, 2013. The City
defendants did not notify Liberty until they commenced their
third-party action; their complaint is dated February 4,
2014, and Liberty received it on February 21, 2014. Liberty
did not need to investigate to conclude that a delay in
giving notice was untimely (see West 16th St. Tenants
Corp., 290 A.D.2d at 279; see also American Mfrs.
Mut. Ins. Co. v CMA Enters., 246 A.D.2d 373');">246 A.D.2d 373 [1st Dept
1998]). Similarly, it did not need to investigate to conclude
that the lead exclusion formed a basis for disclaiming; the
third-party complaint says that the plaintiff in the
underlying personal injury action alleged that he was exposed
to lead dust. Moreover, Liberty had sent a letter on October
24, 2013 to the Joint Venture, L & L, and plaintiff,
disclaiming on the basis of the lead exclusion.
is correct that, when a putative insured first makes a claim
for coverage in a complaint, the insurer may disclaim via its
answer (see American Mfrs. Mut. Ins. Co., 246 A.D.2d
at 373). However, the City defendants/third-party plaintiffs
did not waive their argument that Liberty's disclaimer
was untimely by agreeing to extend Liberty's time to
answer (see City of New York v Welsbach Elec. Corp.,
49 A.D.3d 322, 322-323 [1st Dept 2008]).
if, arguendo, Liberty's disclaimer were timely, the lead
exclusion would not relieve Liberty of its duty to defend.
Since the second amended complaint alleges that plaintiff
"was poisoned by exposure to dangerously high levels of
lead dust and other hazardous substances"
(emphasis added), the allegations do not "cast the
pleadings wholly within that ...