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NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
------- --------------
--------------------X Index No.: 158327/13
KEVIN McGONIGAL,
Plaintiff, MOTION SEQUENCE
-against-
MEMORANDUM
NYY STEAK MANHATTAN, LLC, PLAZA CONSTRUCTION OF LAW
CORP. and BARING INDUSTRIES, INC.,
Defendants.
------------------ X Index No.:
Third-Party
PLAZA CONSTRUCTION CORP., 595146/14
Third-Party Plaintiff,
-against-
BARING INDUSTRIES, INC.,
Third-Party Defendant.
----------- ----- -------------------------------- X Second Index No.:
Third-Party
BARING INDUSTRIES, INC., 595130/15
Second Third-Party Plaintiff,
-against-
DAY & NITE REFRIGERATION CORP. and KIMCO
REFRIGERATION CORP.,
Second Third-Party Defendants.
---------------------------------------------------------X
NYY STEAKMANHATTAN, LLC & PLAZA CONSTRUCTION
LLC f/k/a PLAZA CONSTRUCTION CORP.,
Third Third-Party Plaintiffs,
-against-
B&G ELECTRICAL CONTRACTORS, ESS & VEE
ACOUSTICAL CONTRACTORS, INC. and BARING
INDUSTRIES, INC.,
Third Third-Party Defendants.
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TABLEOFCONTENTS
SECTION PAGE
POINT I
BARING'S SECOND THIRD-PARTY COMPLAINT AS AGAINST
DAY & NITE MUST BE SUMMARILY DISMISSED AS A MATTER OF LAW
PURSUANT TO CPLR §3211(a)(1) AND §3212 AS THE SUBJECT AGREEMENT
MANDATES THAT ANY SUCH ACTION BE BROUGHT IN FLORIDA.......................5
A. Summary Judgment Standard.....................................................................5
B. Day & Nite is entitled to summary judgment and the dismissal of Baring's
third-party complaint as the purchase order mandated that the action be brought
in Florida.............................................................................................6
POINT II
ALTERNATIVELY, DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT
AND THE DISMISSAL OF THE THIRD-PARTY COMPLAINT
AS BARING'S NEGLIGENCE RENDERS THE INDEMNITY PROVISIONS
IN THE PURCHASE ORDER UNENFORCEABLE, WHETHER UNDER
NEW YORK OR FLORIDA LAW........................................................................9
POINT III
ALTERNATIVELY, DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT
AND THE DISMISSAL OF BARING'S CLAIM FOR BREACH OF CONTRACT
AS TO INSURANCE PROCUREMENT...............................................................12
POINT IV
ALL COMMON-LAW INDEMNITY AND/OR
CONTRIBUTION CLAIMS AGAINST DAY & NITE MUST BE
SUMMARILY DISMISSED AS PLAINTIFF WAS AN EMPLOYEE
OF DAY & NITE, AND DID NOT SUFFER A "GRAVE INJURY"...............................13
POINT V
SHOULD THE CLAIMS AGAINST DAY & NITE NOT BE DISMISSED,
THE COURT SHOULD ISSUE AN ORDER PURSUANT TO CPLR §3025
GRANTING DAY & NITE LEAVE TO AMEND ITS ANSWER TO
ASSERT CROSS-CLAIMS AS AGAINST B&G AND ESS & VEE...............................14
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TABLE OF AUTHORITIES
CITATION PAGE
New York Cases
Court of Appeals
Alvarez v. Prospect Hosp.,
68 N.Y.2d 320 (1986)......................................................................................5,6
Castro v. United Container Machinery Group, Inc.,
96 N.Y.2d 398 (2001).......................................................................................13
Giuffrida v. Citibank Corp.,
100 N.Y.2d 72 (2003).........................................................................................5
Kimso Apartments, LLC v. Gandhi,
24 N.Y.3d 403 (2014)........................................................................................15
Appellate Divisions
11 Essex Street Corp. v. Tower Ins. Co. of New York,
(13t
153 A.D.3d 1190, 63 N.Y.S.3d 13 Dept. 2017)....................................................9-10
Bast Hatfield, Inc., v. Schalmont Cent. School Dist.,
37 A.D.3d 987, 830 N.Y.S.2d 799 (3d Dept. 2007).....................................................17
Boss v. American Express Financial Advisors, Inc.,
(13t
15 A.D.3d 306, 791 N.Y.S.2d 12 Dept. 2005)......................................................6-7
Calloway v. National Servs. Indus.,
(1st
93 A.D.2d 734, 461 N.Y.S.2d 280 Dept. 1983)......................................................7
Corsivo v. M&S Hotels,
(4th
71 A.D.3d 1556, 896 N.Y.S.2d 921 Dept. 2010).....................................................7
Edwards & Zuck, P.C. v. Cappelli Enterprises, Inc.,
124 A.D.3d 181, 999 N.Y.S.2d 564 (3d Dept. 2014)...................................................15
Everitt v. Nozkowski,
285 A.D.2d 442, 728 N.Y.S.2d 58 (2d Dept. 2001)......................................................11
Fleischman v. Peacock Water Company, Inc.,
51 A.D.3d 1202, 858 N.Y.S.2d 421 (3d Dept. 2008)....................................................14
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Gomez v. V&G Electric, Inc.,
(1st
28 A.D.3d 399, 814 N.Y.S.2d 604 Dept. 2006)......................................................14
Gonzalez v. Old Navy Clothing Co.,
(1st
286 A.D.2d 308, 730 N.Y.S.2d 283 Dept. 2001).....................................................11
Lakeview Outlets, Inc. v. Town of Malta,
166 A.D.2d 1445, 89 N.Y.S.2d 733 (3d Dept. 2018).....................................................16
Lischinskaya v. Carnival Corporation,
56 A.D3d 116, 865 N.Y.S.2d 334 (2d Dept. 2008)........................................................7
Moore v. 3 Phase Equestrian Center, Inc.,
83 A.D.3d 677, 922 N.Y.S.2d 98 (2d Dept. 2011).........................................................6
Naughton v. City of New York,
(1st
94 A.D.3d 1, 940 N.Y.S.2d 21 Dept. 2012)............................................................9
Perez v. Morse Diesel International, Inc.,
(1st
10 A.D.3d 497, 782 N.Y.S.2d 53 Dept. 2004).......................................................12
Tourtellot v. Harza Architects,
55 A.D.3d 1096, 866 N.Y.S.2d 793 (3d Dept. 2008)......................................................7
Ward v. Schenectady,
204 A.D.3d 779, 611 N.Y.S.2d 932 (3d Dept. 1994)....................................................16
Florida Case
Griswold Ready Mix Concrete, Inc. v. Reddick,
ISt
134 So.3d 985 (Fla. DCA 2012).........................................................................10
New York Statutes
CPLR §3212.............................................................................................passim
CPLR §3025..................................................................................................15
General Obligations Law §5-322.1........................................................................10
Labor Law §200..............................................................................................11
Workers'
Compensation Law §11..........................................................................13
Florida Statute
Florida Statute §725.06......................................................................................10
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This Memorandum of Law is respectfully submitted in further support of Day & Nite's
accompanying motion, which seeks an Order:
A) pursuant to CPLR §3211(a)(1) and §3212, granting summary judgment in
favor of DAY & NITE REFRIGERATION CORP. and KIMCO
REFRIGERATION CORP., and dismissing the Second Third-Party
Complaint and any and all claims as against DAY & NITE
REFRIGERATION CORP. and KIMCO REFRIGERATION CORP. in
their entirety and with prejudice; and
B) alternatively, pursuant to CPLR §3025, granting DAY & NITE
REFRIGERATION CORP. and KIMCO REFRIGERATION CORP.
leave to amend their Verified Amended Answer to Second Third-Party
Complaint to include cross-claims as against Third Third-Party Defendants
B&G ELECTRICAL CONTRACTORS and ESS & VEE ACOUSTICAL
CONTRACTORS, INC.; and
C) awarding such other and further relief as the Court may deem just and proper.
The Court is referred to Day & Nite's counsel's Affirmation in Support of the motion for
a full recitation of the procedural history, facts and legal arguments, as well as the exhibits which
further support Day & Nite's entitlement to the dismissal of all claims as against it.
ARGUMENT
POINT I
BARING'S SECOND THIRD-PARTY COMPLAINT AS AGAINST DAY & NITE MUST
BE SUMMARILY DISMISSED IN ITS ENTIRETY AS A MATTER OF LAW
PURSUANT TO CPLR 63211(a)(1) AND 63212 AS THE SUBJECT AGREEMENT
MANDATES THAT ANY SUCH ACTION BE BROUGHT IN FLORIDA
A. Summary Judgment Standard
It is well settled that the proponent of a summary judgment motion must make a prima
facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence in
admissible form to demonstrate the absence of any material issues of fact. Giuffrida v. Citibank
Corp., 100 N.Y.2d 72 (2003); Alvarez v. Prospect Hosp., 68 N.Y.2d 320 (1986). Once this
showing has been made, the burden shifts to the party opposing the motion to produce evidentiary
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proof in admissible form sufficient to establish the existence of material issues of fact that require
a trial for resolution. Alvarez, supra, Moore v. 3 Phase Equestrian Center, Inc., 83 A.D.3d 677,
922 N.Y.S.2d 98, 100 (2d Dept. 2011).
B. Day & Nite is entitled to summary judgment and the dismissal of Baring's
third-party complaint as the purchase order mandated that the action be
brought in Florida.
A true and accurate copy of Day & Nite's purchase order subcontract is annexed to the
"Z."
motion papers as Exhibit The form(s) were provided by Baring and are drafted on Baring
letterhead. The complete purchase order, including all terms and conditions thereto, was executed
by both parties prior to the date of the alleged accident.
Section 23 on page three provides that the contract shall be construed according to the laws
of the State of Florida. Section 24 is a forum selection clause that mandates that any suit or action
brought to enforce the agreement shall be brought in Dade County, Florida.
It isundisputed that Baring brought itsthird-party action against Day & Nite as part of the
instant lawsuit in the Supreme Court of the State of New York, New York County. This was
improper under the contract's forum selection and choice of law provisions. There is no issue of
material fact that the subject agreement was executed by the parties before the date of the accident,
and that itcontains these express and unambiguous provisions. In itsAmended Answer (See, Ex.
G to the motion), Day & Nite raised as affirmative defenses that New York is an improper forum
for Baring's action, and that Day & Nite has a defense founded upon documentary evidence, i.e.
the purchase order. These defenses are thus preserved and form the basis for the summary
dismissal pursuant to CPLR §3211(a)(1) and §3212 of the Second Third-Party Action in its
entirety. The Court should therefore issue an Order directing same.
Itis the well-established policy of New York courts to enforce contractual provisions for
choice of law and selection of a forum for litigation. Boss v.American Express Financial Advisors,
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(1st
Inc., 15 A.D.3d 306, 791 N.Y.S.2d 12 Dept. 2005). The provisions are generally prima facie
evidence that the parties intended to litigate in the chosen state and have that state's law apply. In
order to invalidate a provision, a party must show that its enforcement would be unreasonable,
unjust, or would contravene public policy, or that the clause is invalid because of fraud or
overreaching. Id. Moreover, a party may not have the provision invalidated based on the fact that
"foreign"
the state's law may be lessfavorable to its position than New York's, or that a New York
"foreign"
court may look with disfavor on the law. Id.
Day & Nite's participation in the litigation in New York does not waive the defense
afforded by the forum selection clause. Having raised the defense in itsanswer, Day & Nite was
entitled to rely on it later in the litigation and was not under any obligation to move on it more
quickly. Lischinskaya v. Carnival Corporation, 56 A.D.3d 116, 865 N.Y.S.2d 334 (2d Dept.
2008). A defendant, by simply defending on the merits and seeking discovery, does not expressly
or impliedly waive itsjurisdictional objection. Calloway v. National Servs. Indus., 93 A.D.2d 734,
(1st
461 N.Y.S.2d 280 Dept. 1983). "If the objection is used as a defense in the answer instead of
being taken by motion, itevinces the defendant's preference to defer determination of the objection
itself"
until later, perhaps until the trial Id. (emphasis in original).
If Baring desired a more prompt resolution of the issue, it could have moved to strike the
affirmative defense, but did not do so. Lischinskaya, supra, Calloway, supra.
Claims for contractual indemnity in a Labor Law action arise under the contract and are
thus subject to the forum selection provision in the agreement. Corsivo v. M&S Hotels, 71 A.D.3d
(4th
1556, 896 N.Y.S.2d 921 Dept. 2010). Moreover, forum selection clauses may be applicable
and enforceable even when the underlying action results from claims brought by a third-party such
as an injured plaintiff. Tourtellot v. Harza Architects, 55 A.D.3d 1096, 866 N.Y.S.2d 793 (3d
Dept. 2008).
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In the case at hand, the subject purchase order unambiguously provides that any suit or
action to enforce the agreement shall be brought in Florida. Obviously, Baring's third-party action
as against Day & Nite falls into this category; Baring is seeking to enforce the indemnity and
insurance provisions in the agreement.
In itsSecond Third-Party Complaint, Baring brought causes of action against Day & Nite
for indemnification generally (firstcause of action), contractual indemnification (second cause of
action), common law indemnification/contribution (third cause of action), breach of contract based
on the failure to procure proper insurance (fourth cause of action), as well as a mish mash of claims
for "negligence and/or breach of contract and/or breach of warranty and/or breach of statute and/or
thereof."
gross negligence, or some combination (¶35).
Each and every one of the contractual-based claims must be summarily dismissed in their
entirety pursuant to the choice of law and forum selection provisions in the purchase order. Any
remaining common law claims must be dismissed in their entirety pursuant to the protections
Workers'
afforded Day & Nite under New York's Compensation statute (discussed below). The
Second Third-Party Complaint must therefore be dismissed in its entirety. There is no evidence
whatsoever that the enforcement of the forum selection provision would be unreasonable, unjust,
or would contravene public policy, or that the clause is invalid because of fraud or overreaching.
Boss, supra. Baring and Day & Nite are sophisticated commercial entities who were retained to
perform work on a high end construction project in Midtown Manhattan. They entered into an
arm's length agreement with mutual consideration. Perhaps most significantly, Baring provided
the purchase order to Day & Nite which included the provisions at issue. There are no triable
issues of fact with respect to any of the foregoing.
Additionally, the only party with whom Day & Nite is in privity of contract is Baring. Day
& Nite did not have a contract with any other party in the litigation or in connection with the
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"AA"
subject project. (See, Ex. to the motion). No party or entity other than Baring is named in
the indemnity and insurance provisions in the Baring/Day & Nite agreement, whether by name or
by title (i.e. Owner, General Contractor, etc.). Nothing the Baring/Day & Nite agreement
incorporated the terms and conditions of other contract and did not confer third-
any by reference,
party beneficiary status on any other entity or person. Therefore, any contractual claim(s) by any
other party as against Day & Nite must also be dismissed. Naughton v. City of New York, 94
(1st
A.D.3d 1, 940 N.Y.S.2d 21 Dept. 2012).
Accordingly, it isrespectfully requested that the Court issue an Order pursuant to CPLR
§3211(a)(1) and §3212, awarding summary judgment to Day & Nite and dismissing Baring's
Second Third-Party Complaint in its entirety, as well as any other contractual claims against Day
& Nite, with prejudice.
POINT II
ALTERNATIVELY. DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT
AND THE DISMISSAL OF THE THIRD-PARTY COMPLAINT AS BARING'S
NEGLIGENCE RENDERS THE INDEMNITY PROVISIONS IN THE PURCHASE
ORDER UNENFORCEABLE. WHETHER UNDER NEW YORK OR FLORIDA LAW
Alternatively, itis respectfully submitted that Day & Nite is entitled to summary judgment
and the dismissal of Baring's contractual indemnity claim as the provisions in the subject purchase
order are void and unenforceable due to Baring's negligence in connection with the alleged
language,"
accident. Neither provision contains any so-called "saving such as "to the fullest extent
law,"
of the and impermissibly contemplates Day & Nite indemnifying Baring for Baring's own
negligence. This renders the entirety of each provision void under the common law, public policy
and statutes of both New York and Florida.
In New York, it is well settled that indemnity provisions in construction contracts which
purport to indemnify the promisee for its own negligence are void as a matter of public policy. 11
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(1st
Essex Street Corp. v. Tower Ins. Co. of New York, 153 A.D.3d 1190, 63 N.Y.S.3d 13 Dept.
2017). "The Court of Appeals has held that a contract that purports to indemnify the indemnitee
against its own negligence is not merely void as to the portion requiring indemnification of the
indemnitee's negligence, but that the entire indemnification agreement is void, and the promisee
agreement."
may not collect under any part of the Id., citing Itri Brick & Concrete Corp. v. Aetna
Cas. & Sur. Co., 89 N.Y.2d 786 (1997). This is codified in General Obligations Law §5-322.1,
part."
and is the result whether the indemnitee's negligence is "in whole or in
language"
As in the 11 Essex Street case, supra, there are no limiting phrases or any "saving
in the indemnity provisions in the Baring/Day & Nite agreement that indicate partial
indemnification.
Florida's approach to this issue is similar. Florida prohibits any indemnity for the negligent
conduct of the indemnitee, unless the written indemnity provision expressly provides for itin clear
and unequivocal terms, and contains a monetary limitation on the potential indemnity. See,
Florida Statutes §725.06 (copy annexed hereto). In the absence of such language, an indemnitee
can only be indemnified for the sole negligence of the indemnitor.
13t
In Griswold Ready Mix Concrete, Inc. v. Reddick, 134 So.3d 985 (Fla. DCA 2012) (copy
annexed hereto), the Florida District Court of Appeal reiterated and confirmed that when an
indemnity provision does not contain a dollar limit on the indemnitor's potential liability, itis void
and unenforceable pursuant to the statute cited above.
In the case at hand, the indemnity provisions in the Baring/Day & Nite contract violate the
Florida statute in that they do not contain clear and unequivocal language contemplating indemnity
to Baring for Baring's negligence, and do not contain any monetary limitation on same.
The contractual terms are undisputed. Therefore, upon a showing of even 1% partial
negligence on the part of Baring, the indemnification provisions in the subject purchase order are
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void and unenforceable. Evidence of Baring's negligence comes from Baring's contractual duty
to supervise its subcontractors, and the deposition testimony of its witness, Chris Wolske.
(1st
Gonzalez v. Old Navy Clothing Co., 286 A.D.2d 308, 730 N.Y.S. 2d Dept. 2001). Under the
contract, Baring was fully responsible for allthe acts and omissions of its subcontractors such as
Day & Nite. Additionally, Baring was obligated "keep on the job throughout its duration a
competent superintendent and any necessary assistants, all of whom must be satisfactory to the
Manager."
Construction Mr. Wolske has admitted that he was only at the site perhaps one time
per week, and that no other Baring personnel maintained a presence. Baring should not be
sand"
permitted to "bury itshead in the in connection with any alleged unsafe conditions when its
failure to maintain a continuous presence at the site was a breach of itscontractual obligations.
Although neither Baring nor Day & Nite was responsible for the three conditions that
plaintiff claims caused his accident, i.e.the unbarricaded elevator pit,the piece of wood debris he
tripped on, and the lighting, Baring had authority over Day & Nite's work and thus can be charged
with negligence as a statutory agent under Labor Law §200.
Labor Law §200 is a codification of the common law duty to provide workers with a safe
work environment. It applies to owners, contractors or their agents who have the authority to
exercise supervision and control over the work bringing about the injury to enable itto avoid or
correct an unsafe condition. When the work giving rise to the duty to keep construction areas safe
for employees has been delegated to a third party such as Baring, that third party then obtains the
concomitant authority to supervise and control that work and becomes a statutory agent of the
owner or general contractor. See, Labor Law §200; Everitt v. Nozkowski, 285 A.D.2d 442, 728
N.Y.S.2d 58 (2d Dept. 2001). Baring's negligence with respect to failing to ensure that plaintiff
McGonigal, an employee of Baring's subcontractor, had a safe work environment renders the
subject indemnity provisions in the Baring/Day & Nite agreement void and unenforceable, under
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either New York or Florida law. Day & Nite should therefore be awarded summary judgment and
the dismissal of Baring's claim seeking contractual indemnity on this ground as well.
Conversely, and arguendo, in the event that the Court ultimately holds that Baring was not
negligent, by definition the same result applies to Day & Nite, as Baring was contractually
responsible for the acts and omissions of its subcontractors.
POINT III
ALTERNATIVELY. DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT AND
THE DISMISSAL OF BARING'S CLAIM FOR BREACH OF CONTRACT AS TO
INSURANCE PROCUREMENT
Baring's third-party claim for breach of contract against Day & Nite must also be dismissed
"DD"
as a matter of law. Annexed to the motion papers as Exhibit is a certified copy of the
relevant endorsement from Day & Nite's liability policy MPA00000075346L from Harleysville
Insurance Company of New York, along with a Certificate of Insurance, which covers the subject
accident. Endorsement CG-7254 adds to the policy as an additional insured any person or
organization for whom Day & Nite is performing work when required in a written contract.
It is well settled that where, as here, a contracting party purchases a liability policy from
an insurance company with a blanket endorsement for contractually designated additional
insureds, they have satisfied their contractual obligation to procure insurance. Even if the insurer
refuses to indemnify the additional insured, that would not alter the conclusion. Perez v. Morse
(1st
Diesel International, Inc., 10 A.D.3d 497, 782 N.Y.S.2d 53 Dept. 2004).
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POINT IV
ALL COMMON-LAW INDEMNITY AND/OR
CONTRIBUTION CLAIMS AGAINST DAY & NITE MUST BE
SUMMARILY DISMISSED AS PLAINTIFF WAS AN EMPLOYEE OF DAY & NITE
INJURY"
AND DID NOT SUFFER A "GRAVE
As plaintiff was undisputedly an employee of Day & Nite, and working in his capacity as
a Day & Nite employee on the date of the alleged accident, and plaintiff elected to receive
Workers'
Compensation benefits as a result of the all common law claims and cross-
accident,
Workers'
claims against Day & Nite are barred by New York State Compensation Law §11, and
must be summarily dismissed.
Workers'
Compensation Law §11 provides, in pertinent part, that:
[A]n employer shall not be liable for contribution or indemnity to
any third person based upon liability for injuries sustained by an
employee acting within the scope of his or her employment for such
employer unless such third person proves through competent
injury."
medical evidence that such employee has sustained a "grave
injury,"
Moreover, although the statute allows for such claims where there is a "grave itis
injury"
clear that such a situation does not apply here. Specifically, §11 defines a "grave as:
[O]nly one or more of the following: death, permanent and total loss
of use or amputation of an arm, leg, hand or foot, loss of multiple
fingers, loss of multiple toes, paraplegia, or quadriplegia, total or
permanent blindness, total and permanent deafness, loss of nose, loss
of ear, permanent and severe facial disfigurement, loss of an index
finger, or an acquired injury to the brain caused by external force or
itsresulting permanent or total disability.
injury" illustrative."
The list of injuries that define the term "grave is "exhaustive and not
See e.g., Castro v. United Container Machinery Group, Inc., 96 N.Y.2d 398 (2001) (i.e."loss of
fingers"
multiple contained in the list of grave injuries does not include partial loss of multiple
fingers).
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FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ------- -------------- --------------------X Index No.: 158327/13 KEVIN McGONIGAL, Plaintiff, MOTION SEQUENCE -against- MEMORANDUM NYY STEAK MANHATTAN, LLC, PLAZA CONSTRUCTION OF LAW CORP. and BARING INDUSTRIES, INC., Defendants. ------------------ X Index No.: Third-Party PLAZA CONSTRUCTION CORP., 595146/14 Third-Party Plaintiff, -against- BARING INDUSTRIES, INC., Third-Party Defendant. ----------- ----- -------------------------------- X Second Index No.: Third-Party BARING INDUSTRIES, INC., 595130/15 Second Third-Party Plaintiff, -against- DAY & NITE REFRIGERATION CORP. and KIMCO REFRIGERATION CORP., Second Third-Party Defendants. ---------------------------------------------------------X NYY STEAKMANHATTAN, LLC & PLAZA CONSTRUCTION LLC f/k/a PLAZA CONSTRUCTION CORP., Third Third-Party Plaintiffs, -against- B&G ELECTRICAL CONTRACTORS, ESS & VEE ACOUSTICAL CONTRACTORS, INC. and BARING INDUSTRIES, INC., Third Third-Party Defendants. --------------------------- X 1 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 TABLEOFCONTENTS SECTION PAGE POINT I BARING'S SECOND THIRD-PARTY COMPLAINT AS AGAINST DAY & NITE MUST BE SUMMARILY DISMISSED AS A MATTER OF LAW PURSUANT TO CPLR §3211(a)(1) AND §3212 AS THE SUBJECT AGREEMENT MANDATES THAT ANY SUCH ACTION BE BROUGHT IN FLORIDA.......................5 A. Summary Judgment Standard.....................................................................5 B. Day & Nite is entitled to summary judgment and the dismissal of Baring's third-party complaint as the purchase order mandated that the action be brought in Florida.............................................................................................6 POINT II ALTERNATIVELY, DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT AND THE DISMISSAL OF THE THIRD-PARTY COMPLAINT AS BARING'S NEGLIGENCE RENDERS THE INDEMNITY PROVISIONS IN THE PURCHASE ORDER UNENFORCEABLE, WHETHER UNDER NEW YORK OR FLORIDA LAW........................................................................9 POINT III ALTERNATIVELY, DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT AND THE DISMISSAL OF BARING'S CLAIM FOR BREACH OF CONTRACT AS TO INSURANCE PROCUREMENT...............................................................12 POINT IV ALL COMMON-LAW INDEMNITY AND/OR CONTRIBUTION CLAIMS AGAINST DAY & NITE MUST BE SUMMARILY DISMISSED AS PLAINTIFF WAS AN EMPLOYEE OF DAY & NITE, AND DID NOT SUFFER A "GRAVE INJURY"...............................13 POINT V SHOULD THE CLAIMS AGAINST DAY & NITE NOT BE DISMISSED, THE COURT SHOULD ISSUE AN ORDER PURSUANT TO CPLR §3025 GRANTING DAY & NITE LEAVE TO AMEND ITS ANSWER TO ASSERT CROSS-CLAIMS AS AGAINST B&G AND ESS & VEE...............................14 2 2 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 TABLE OF AUTHORITIES CITATION PAGE New York Cases Court of Appeals Alvarez v. Prospect Hosp., 68 N.Y.2d 320 (1986)......................................................................................5,6 Castro v. United Container Machinery Group, Inc., 96 N.Y.2d 398 (2001).......................................................................................13 Giuffrida v. Citibank Corp., 100 N.Y.2d 72 (2003).........................................................................................5 Kimso Apartments, LLC v. Gandhi, 24 N.Y.3d 403 (2014)........................................................................................15 Appellate Divisions 11 Essex Street Corp. v. Tower Ins. Co. of New York, (13t 153 A.D.3d 1190, 63 N.Y.S.3d 13 Dept. 2017)....................................................9-10 Bast Hatfield, Inc., v. Schalmont Cent. School Dist., 37 A.D.3d 987, 830 N.Y.S.2d 799 (3d Dept. 2007).....................................................17 Boss v. American Express Financial Advisors, Inc., (13t 15 A.D.3d 306, 791 N.Y.S.2d 12 Dept. 2005)......................................................6-7 Calloway v. National Servs. Indus., (1st 93 A.D.2d 734, 461 N.Y.S.2d 280 Dept. 1983)......................................................7 Corsivo v. M&S Hotels, (4th 71 A.D.3d 1556, 896 N.Y.S.2d 921 Dept. 2010).....................................................7 Edwards & Zuck, P.C. v. Cappelli Enterprises, Inc., 124 A.D.3d 181, 999 N.Y.S.2d 564 (3d Dept. 2014)...................................................15 Everitt v. Nozkowski, 285 A.D.2d 442, 728 N.Y.S.2d 58 (2d Dept. 2001)......................................................11 Fleischman v. Peacock Water Company, Inc., 51 A.D.3d 1202, 858 N.Y.S.2d 421 (3d Dept. 2008)....................................................14 3 3 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 Gomez v. V&G Electric, Inc., (1st 28 A.D.3d 399, 814 N.Y.S.2d 604 Dept. 2006)......................................................14 Gonzalez v. Old Navy Clothing Co., (1st 286 A.D.2d 308, 730 N.Y.S.2d 283 Dept. 2001).....................................................11 Lakeview Outlets, Inc. v. Town of Malta, 166 A.D.2d 1445, 89 N.Y.S.2d 733 (3d Dept. 2018).....................................................16 Lischinskaya v. Carnival Corporation, 56 A.D3d 116, 865 N.Y.S.2d 334 (2d Dept. 2008)........................................................7 Moore v. 3 Phase Equestrian Center, Inc., 83 A.D.3d 677, 922 N.Y.S.2d 98 (2d Dept. 2011).........................................................6 Naughton v. City of New York, (1st 94 A.D.3d 1, 940 N.Y.S.2d 21 Dept. 2012)............................................................9 Perez v. Morse Diesel International, Inc., (1st 10 A.D.3d 497, 782 N.Y.S.2d 53 Dept. 2004).......................................................12 Tourtellot v. Harza Architects, 55 A.D.3d 1096, 866 N.Y.S.2d 793 (3d Dept. 2008)......................................................7 Ward v. Schenectady, 204 A.D.3d 779, 611 N.Y.S.2d 932 (3d Dept. 1994)....................................................16 Florida Case Griswold Ready Mix Concrete, Inc. v. Reddick, ISt 134 So.3d 985 (Fla. DCA 2012).........................................................................10 New York Statutes CPLR §3212.............................................................................................passim CPLR §3025..................................................................................................15 General Obligations Law §5-322.1........................................................................10 Labor Law §200..............................................................................................11 Workers' Compensation Law §11..........................................................................13 Florida Statute Florida Statute §725.06......................................................................................10 4 4 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 This Memorandum of Law is respectfully submitted in further support of Day & Nite's accompanying motion, which seeks an Order: A) pursuant to CPLR §3211(a)(1) and §3212, granting summary judgment in favor of DAY & NITE REFRIGERATION CORP. and KIMCO REFRIGERATION CORP., and dismissing the Second Third-Party Complaint and any and all claims as against DAY & NITE REFRIGERATION CORP. and KIMCO REFRIGERATION CORP. in their entirety and with prejudice; and B) alternatively, pursuant to CPLR §3025, granting DAY & NITE REFRIGERATION CORP. and KIMCO REFRIGERATION CORP. leave to amend their Verified Amended Answer to Second Third-Party Complaint to include cross-claims as against Third Third-Party Defendants B&G ELECTRICAL CONTRACTORS and ESS & VEE ACOUSTICAL CONTRACTORS, INC.; and C) awarding such other and further relief as the Court may deem just and proper. The Court is referred to Day & Nite's counsel's Affirmation in Support of the motion for a full recitation of the procedural history, facts and legal arguments, as well as the exhibits which further support Day & Nite's entitlement to the dismissal of all claims as against it. ARGUMENT POINT I BARING'S SECOND THIRD-PARTY COMPLAINT AS AGAINST DAY & NITE MUST BE SUMMARILY DISMISSED IN ITS ENTIRETY AS A MATTER OF LAW PURSUANT TO CPLR 63211(a)(1) AND 63212 AS THE SUBJECT AGREEMENT MANDATES THAT ANY SUCH ACTION BE BROUGHT IN FLORIDA A. Summary Judgment Standard It is well settled that the proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence in admissible form to demonstrate the absence of any material issues of fact. Giuffrida v. Citibank Corp., 100 N.Y.2d 72 (2003); Alvarez v. Prospect Hosp., 68 N.Y.2d 320 (1986). Once this showing has been made, the burden shifts to the party opposing the motion to produce evidentiary 5 5 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 proof in admissible form sufficient to establish the existence of material issues of fact that require a trial for resolution. Alvarez, supra, Moore v. 3 Phase Equestrian Center, Inc., 83 A.D.3d 677, 922 N.Y.S.2d 98, 100 (2d Dept. 2011). B. Day & Nite is entitled to summary judgment and the dismissal of Baring's third-party complaint as the purchase order mandated that the action be brought in Florida. A true and accurate copy of Day & Nite's purchase order subcontract is annexed to the "Z." motion papers as Exhibit The form(s) were provided by Baring and are drafted on Baring letterhead. The complete purchase order, including all terms and conditions thereto, was executed by both parties prior to the date of the alleged accident. Section 23 on page three provides that the contract shall be construed according to the laws of the State of Florida. Section 24 is a forum selection clause that mandates that any suit or action brought to enforce the agreement shall be brought in Dade County, Florida. It isundisputed that Baring brought itsthird-party action against Day & Nite as part of the instant lawsuit in the Supreme Court of the State of New York, New York County. This was improper under the contract's forum selection and choice of law provisions. There is no issue of material fact that the subject agreement was executed by the parties before the date of the accident, and that itcontains these express and unambiguous provisions. In itsAmended Answer (See, Ex. G to the motion), Day & Nite raised as affirmative defenses that New York is an improper forum for Baring's action, and that Day & Nite has a defense founded upon documentary evidence, i.e. the purchase order. These defenses are thus preserved and form the basis for the summary dismissal pursuant to CPLR §3211(a)(1) and §3212 of the Second Third-Party Action in its entirety. The Court should therefore issue an Order directing same. Itis the well-established policy of New York courts to enforce contractual provisions for choice of law and selection of a forum for litigation. Boss v.American Express Financial Advisors, 6 6 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 (1st Inc., 15 A.D.3d 306, 791 N.Y.S.2d 12 Dept. 2005). The provisions are generally prima facie evidence that the parties intended to litigate in the chosen state and have that state's law apply. In order to invalidate a provision, a party must show that its enforcement would be unreasonable, unjust, or would contravene public policy, or that the clause is invalid because of fraud or overreaching. Id. Moreover, a party may not have the provision invalidated based on the fact that "foreign" the state's law may be lessfavorable to its position than New York's, or that a New York "foreign" court may look with disfavor on the law. Id. Day & Nite's participation in the litigation in New York does not waive the defense afforded by the forum selection clause. Having raised the defense in itsanswer, Day & Nite was entitled to rely on it later in the litigation and was not under any obligation to move on it more quickly. Lischinskaya v. Carnival Corporation, 56 A.D.3d 116, 865 N.Y.S.2d 334 (2d Dept. 2008). A defendant, by simply defending on the merits and seeking discovery, does not expressly or impliedly waive itsjurisdictional objection. Calloway v. National Servs. Indus., 93 A.D.2d 734, (1st 461 N.Y.S.2d 280 Dept. 1983). "If the objection is used as a defense in the answer instead of being taken by motion, itevinces the defendant's preference to defer determination of the objection itself" until later, perhaps until the trial Id. (emphasis in original). If Baring desired a more prompt resolution of the issue, it could have moved to strike the affirmative defense, but did not do so. Lischinskaya, supra, Calloway, supra. Claims for contractual indemnity in a Labor Law action arise under the contract and are thus subject to the forum selection provision in the agreement. Corsivo v. M&S Hotels, 71 A.D.3d (4th 1556, 896 N.Y.S.2d 921 Dept. 2010). Moreover, forum selection clauses may be applicable and enforceable even when the underlying action results from claims brought by a third-party such as an injured plaintiff. Tourtellot v. Harza Architects, 55 A.D.3d 1096, 866 N.Y.S.2d 793 (3d Dept. 2008). 7 7 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 In the case at hand, the subject purchase order unambiguously provides that any suit or action to enforce the agreement shall be brought in Florida. Obviously, Baring's third-party action as against Day & Nite falls into this category; Baring is seeking to enforce the indemnity and insurance provisions in the agreement. In itsSecond Third-Party Complaint, Baring brought causes of action against Day & Nite for indemnification generally (firstcause of action), contractual indemnification (second cause of action), common law indemnification/contribution (third cause of action), breach of contract based on the failure to procure proper insurance (fourth cause of action), as well as a mish mash of claims for "negligence and/or breach of contract and/or breach of warranty and/or breach of statute and/or thereof." gross negligence, or some combination (¶35). Each and every one of the contractual-based claims must be summarily dismissed in their entirety pursuant to the choice of law and forum selection provisions in the purchase order. Any remaining common law claims must be dismissed in their entirety pursuant to the protections Workers' afforded Day & Nite under New York's Compensation statute (discussed below). The Second Third-Party Complaint must therefore be dismissed in its entirety. There is no evidence whatsoever that the enforcement of the forum selection provision would be unreasonable, unjust, or would contravene public policy, or that the clause is invalid because of fraud or overreaching. Boss, supra. Baring and Day & Nite are sophisticated commercial entities who were retained to perform work on a high end construction project in Midtown Manhattan. They entered into an arm's length agreement with mutual consideration. Perhaps most significantly, Baring provided the purchase order to Day & Nite which included the provisions at issue. There are no triable issues of fact with respect to any of the foregoing. Additionally, the only party with whom Day & Nite is in privity of contract is Baring. Day & Nite did not have a contract with any other party in the litigation or in connection with the 8 8 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 "AA" subject project. (See, Ex. to the motion). No party or entity other than Baring is named in the indemnity and insurance provisions in the Baring/Day & Nite agreement, whether by name or by title (i.e. Owner, General Contractor, etc.). Nothing the Baring/Day & Nite agreement incorporated the terms and conditions of other contract and did not confer third- any by reference, party beneficiary status on any other entity or person. Therefore, any contractual claim(s) by any other party as against Day & Nite must also be dismissed. Naughton v. City of New York, 94 (1st A.D.3d 1, 940 N.Y.S.2d 21 Dept. 2012). Accordingly, it isrespectfully requested that the Court issue an Order pursuant to CPLR §3211(a)(1) and §3212, awarding summary judgment to Day & Nite and dismissing Baring's Second Third-Party Complaint in its entirety, as well as any other contractual claims against Day & Nite, with prejudice. POINT II ALTERNATIVELY. DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT AND THE DISMISSAL OF THE THIRD-PARTY COMPLAINT AS BARING'S NEGLIGENCE RENDERS THE INDEMNITY PROVISIONS IN THE PURCHASE ORDER UNENFORCEABLE. WHETHER UNDER NEW YORK OR FLORIDA LAW Alternatively, itis respectfully submitted that Day & Nite is entitled to summary judgment and the dismissal of Baring's contractual indemnity claim as the provisions in the subject purchase order are void and unenforceable due to Baring's negligence in connection with the alleged language," accident. Neither provision contains any so-called "saving such as "to the fullest extent law," of the and impermissibly contemplates Day & Nite indemnifying Baring for Baring's own negligence. This renders the entirety of each provision void under the common law, public policy and statutes of both New York and Florida. In New York, it is well settled that indemnity provisions in construction contracts which purport to indemnify the promisee for its own negligence are void as a matter of public policy. 11 9 9 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 (1st Essex Street Corp. v. Tower Ins. Co. of New York, 153 A.D.3d 1190, 63 N.Y.S.3d 13 Dept. 2017). "The Court of Appeals has held that a contract that purports to indemnify the indemnitee against its own negligence is not merely void as to the portion requiring indemnification of the indemnitee's negligence, but that the entire indemnification agreement is void, and the promisee agreement." may not collect under any part of the Id., citing Itri Brick & Concrete Corp. v. Aetna Cas. & Sur. Co., 89 N.Y.2d 786 (1997). This is codified in General Obligations Law §5-322.1, part." and is the result whether the indemnitee's negligence is "in whole or in language" As in the 11 Essex Street case, supra, there are no limiting phrases or any "saving in the indemnity provisions in the Baring/Day & Nite agreement that indicate partial indemnification. Florida's approach to this issue is similar. Florida prohibits any indemnity for the negligent conduct of the indemnitee, unless the written indemnity provision expressly provides for itin clear and unequivocal terms, and contains a monetary limitation on the potential indemnity. See, Florida Statutes §725.06 (copy annexed hereto). In the absence of such language, an indemnitee can only be indemnified for the sole negligence of the indemnitor. 13t In Griswold Ready Mix Concrete, Inc. v. Reddick, 134 So.3d 985 (Fla. DCA 2012) (copy annexed hereto), the Florida District Court of Appeal reiterated and confirmed that when an indemnity provision does not contain a dollar limit on the indemnitor's potential liability, itis void and unenforceable pursuant to the statute cited above. In the case at hand, the indemnity provisions in the Baring/Day & Nite contract violate the Florida statute in that they do not contain clear and unequivocal language contemplating indemnity to Baring for Baring's negligence, and do not contain any monetary limitation on same. The contractual terms are undisputed. Therefore, upon a showing of even 1% partial negligence on the part of Baring, the indemnification provisions in the subject purchase order are 10 10 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 void and unenforceable. Evidence of Baring's negligence comes from Baring's contractual duty to supervise its subcontractors, and the deposition testimony of its witness, Chris Wolske. (1st Gonzalez v. Old Navy Clothing Co., 286 A.D.2d 308, 730 N.Y.S. 2d Dept. 2001). Under the contract, Baring was fully responsible for allthe acts and omissions of its subcontractors such as Day & Nite. Additionally, Baring was obligated "keep on the job throughout its duration a competent superintendent and any necessary assistants, all of whom must be satisfactory to the Manager." Construction Mr. Wolske has admitted that he was only at the site perhaps one time per week, and that no other Baring personnel maintained a presence. Baring should not be sand" permitted to "bury itshead in the in connection with any alleged unsafe conditions when its failure to maintain a continuous presence at the site was a breach of itscontractual obligations. Although neither Baring nor Day & Nite was responsible for the three conditions that plaintiff claims caused his accident, i.e.the unbarricaded elevator pit,the piece of wood debris he tripped on, and the lighting, Baring had authority over Day & Nite's work and thus can be charged with negligence as a statutory agent under Labor Law §200. Labor Law §200 is a codification of the common law duty to provide workers with a safe work environment. It applies to owners, contractors or their agents who have the authority to exercise supervision and control over the work bringing about the injury to enable itto avoid or correct an unsafe condition. When the work giving rise to the duty to keep construction areas safe for employees has been delegated to a third party such as Baring, that third party then obtains the concomitant authority to supervise and control that work and becomes a statutory agent of the owner or general contractor. See, Labor Law §200; Everitt v. Nozkowski, 285 A.D.2d 442, 728 N.Y.S.2d 58 (2d Dept. 2001). Baring's negligence with respect to failing to ensure that plaintiff McGonigal, an employee of Baring's subcontractor, had a safe work environment renders the subject indemnity provisions in the Baring/Day & Nite agreement void and unenforceable, under 11 11 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 either New York or Florida law. Day & Nite should therefore be awarded summary judgment and the dismissal of Baring's claim seeking contractual indemnity on this ground as well. Conversely, and arguendo, in the event that the Court ultimately holds that Baring was not negligent, by definition the same result applies to Day & Nite, as Baring was contractually responsible for the acts and omissions of its subcontractors. POINT III ALTERNATIVELY. DAY & NITE IS ENTITLED TO SUMMARY JUDGMENT AND THE DISMISSAL OF BARING'S CLAIM FOR BREACH OF CONTRACT AS TO INSURANCE PROCUREMENT Baring's third-party claim for breach of contract against Day & Nite must also be dismissed "DD" as a matter of law. Annexed to the motion papers as Exhibit is a certified copy of the relevant endorsement from Day & Nite's liability policy MPA00000075346L from Harleysville Insurance Company of New York, along with a Certificate of Insurance, which covers the subject accident. Endorsement CG-7254 adds to the policy as an additional insured any person or organization for whom Day & Nite is performing work when required in a written contract. It is well settled that where, as here, a contracting party purchases a liability policy from an insurance company with a blanket endorsement for contractually designated additional insureds, they have satisfied their contractual obligation to procure insurance. Even if the insurer refuses to indemnify the additional insured, that would not alter the conclusion. Perez v. Morse (1st Diesel International, Inc., 10 A.D.3d 497, 782 N.Y.S.2d 53 Dept. 2004). 12 12 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319 RECEIVED NYSCEF: 07/18/2019 POINT IV ALL COMMON-LAW INDEMNITY AND/OR CONTRIBUTION CLAIMS AGAINST DAY & NITE MUST BE SUMMARILY DISMISSED AS PLAINTIFF WAS AN EMPLOYEE OF DAY & NITE INJURY" AND DID NOT SUFFER A "GRAVE As plaintiff was undisputedly an employee of Day & Nite, and working in his capacity as a Day & Nite employee on the date of the alleged accident, and plaintiff elected to receive Workers' Compensation benefits as a result of the all common law claims and cross- accident, Workers' claims against Day & Nite are barred by New York State Compensation Law §11, and must be summarily dismissed. Workers' Compensation Law §11 provides, in pertinent part, that: [A]n employer shall not be liable for contribution or indemnity to any third person based upon liability for injuries sustained by an employee acting within the scope of his or her employment for such employer unless such third person proves through competent injury." medical evidence that such employee has sustained a "grave injury," Moreover, although the statute allows for such claims where there is a "grave itis injury" clear that such a situation does not apply here. Specifically, §11 defines a "grave as: [O]nly one or more of the following: death, permanent and total loss of use or amputation of an arm, leg, hand or foot, loss of multiple fingers, loss of multiple toes, paraplegia, or quadriplegia, total or permanent blindness, total and permanent deafness, loss of nose, loss of ear, permanent and severe facial disfigurement, loss of an index finger, or an acquired injury to the brain caused by external force or itsresulting permanent or total disability. injury" illustrative." The list of injuries that define the term "grave is "exhaustive and not See e.g., Castro v. United Container Machinery Group, Inc., 96 N.Y.2d 398 (2001) (i.e."loss of fingers" multiple contained in the list of grave injuries does not include partial loss of multiple fingers). 13 13 of 23 FILED: NEW YORK COUNTY CLERK 07/18/2019 04:15 PM INDEX NO. 158327/2013 NYSCEF DOC. NO. 319