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FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018
NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
ZURICH AMERICAN INSURANCE COMPANY, Index No. 652336/2018
Plaintiffs,
-against- FIRST SPECIALTY INSURANCE
CORPORATION'S ANSWER,
FIRST SPECIALTY INSURANCE CORPORATION
AFFIRMATIVE DEFENSES, AND
WESTERN BEEF RETAIL, INC. and WESTERN BEEF
COUNTERCLAIM
PROPERTIES, INC.,
Defendants.
First Specialty Insurance Corporation ("FSIC") responds to the allegations of the
("Zurich"
Complaint for Declaratory Judgment filed by Zurich American Insurance Company ("Zurich"),
and asserts Affirmative Defenses as set forth below.
NATURE OF THE ACTION
Defendants'
1. This declaratory judgment and breach of contract action arises from
abandonment of Zurich's insured, Serota Roosevelt LLC ("Serota"), on the first day of trial in a
personal injury lawsuit styled Desmond Garrett v. Serota Roosevelt LLC, et al., bearing Index
Action"
No. 702978/2016 (the "Underlying Action").
ANSWER: FSIC admits that this action arises from a personal injury suit styled
Desmond Garrett v. Serota Roosevelt LLC, et al., bearing Index No. 702978/2016 and designated
Action."
herein as the "Underlying FSIC denies that it owed a duty to defend Serota Roosevelt
LLC ("Serota"). FSIC also denies Zurich's characterization that FSIC abandoned Serota at trial
in the Underlying Lawsuit. FSIC denies the remaining allegations of Paragraph 1.
2. Desmond Garrett sued Serota, WB Retail, and WB Properties (WB Retail and
Beef"
WB Properties are collectively referred to as "Western Beef") for a trip and fallthat occurred on
the sidewalk outside the Western Beef supermarket located at 322 Nassau Road, Roosevelt, New
"Premises"
York, 11575 (the "Premises") before he entered the store.
ANSWER: FSIC lacks knowledge or information sufficient to form a belief regarding
store."
whether Mr. Garrett tripped and fell "before he entered the FSIC admits the remaining
allegations of Paragraph 2.
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3. Without so much as a tender, First Specialty, WB Retail, WB Properties, and their
third-party administrator, Broadspire, promptly assumed Serota's defense for the Underlying
Action. They issued no reservation of rights and appointed a single law firm to jointly represent
Serota, the landlord, and Western Beef, the tenant.
ANSWER: To the extent certain allegations of Paragraph 3 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. To the extent a response is required,
upon information and belief, FSIC admits that Western Beef appointed a law firm to represent
Serota and Western Beef in the Underlying Lawsuit. FSIS admits that it did not issue a
reservation of rights to Serota, but FSIC denies that it had any duty to do so. FSIC denies that it
assumed Serota's defense for the Underlying Lawsuit. FSIC denies that it appointed a law firm
to represent Serota or Western Beef. FSIC lacks knowledge or information sufficient to form a
belief regarding the remaining allegations of Paragraph 3.
Defendants'
4. That law firm, under direction and control, steered Serota and
Western Beef through discovery, determined the case strategy, engaged in settlement discussions
on Serota's behalf, and planned on try the case.
ANSWER: To the extent certain allegations of Paragraph 4 are directed at Western
Beef, no response is required from FSIC. To the extent a response is required, upon information
and belief, FSIC admits that the law firm appointed by Western Beef represented Serota and
Western Beef in the Underlying Lawsuit. FSIC lacks knowledge and information sufficient to
form a belief regarding Zurich's characterization of that representation. FSIC denies that the law
firm representing Serota and Western Beef acted under FSIC's direction or control.
5. On the first day of trial,Defendants invoked the factual record their appointed
counsel developed to break their agreement to defend and indemnify Serota, claiming that
Serota, not Western Beef, was liable for the accident. They demanded that Serota and its
commercial general liability insurer, Zurich, settle the case, and that Serota agree to indemnify
Western Beef. Zurich and Serota refused this prejudicial demand and urged Defendants to
reconsider their position in light to the clear harm they had caused to Serota and to Zurich.
Defendants were well aware that until Western Beefs eve of trial demand, Zurich had not been
involved in the case, having closed its file more than a year earlier after being advised that
Defendants has retained counsel for Serota.
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ANSWER: To the extent certain allegations of Paragraph 5 are directed at Western
Beef, no response is required from FSIC. To the extent a response is required, FSIC denies the
allegations of Paragraph 5.
6. Defendants refused, forced Serota to try the case, and used the factual record their
counsel developed to shift liability onto Serota, resulting in a $295,000 verdict against it.
ANSWER: To the extent certain allegations of Paragraph 6 are directed at Western
Beef, no response is required from FSIC. To the extent a response is required, FSIC admits that
a judgment was entered against Serota in the amount of $295,000 plus interest of $5,382.74 and
disbursements of $1,405.00, which total $301,784.74. FSIC denies the remaining allegations of
Paragraph 6.
7. Serota and Zurich bring this suit to compel Defendants to honor their agreement
to defend and indemnify Serota and to obtain reimbursement of the costs they have expended
Defendants'
and will expend as a result of wrongful abandonment.
ANSWER: FSIC admits that Zurich has filed the instant lawsuit against the
Defendants. FSIC lacks knowledge or information sufficient to form a belief regarding Zurich's
reasons for filing the instant lawsuit.
THE PARTIES
8. Zurich is a New York corporation engaged in the insurance business with a
statutory home office located at 4 World Trade Center, 150 Greenwich Street, New York, New
York 10007, and a principal place of business located at 1299 Zurich Way, Schaumburg, Illinois
60196.
ANSWER: Upon information and belief, FSIC admits that Zurich has a principal
place of business located at 1299 Zurich Way, Schaumburg, Illinois 60196. FSIC lacks
knowledge and information sufficient to form a belief regarding the remaining allegations of
Paragraph 8.
9. First Specialty is a Missouri corporation engaged in the insurance business with
an administrative office located at 5200 Metcalf Avenue, Overland Park, KS 66202. First
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Specialty is authorized to, and does engage in the business of insurance in New York through
licensed wholesale brokers as a non-admitted insurer.
ANSWER: FSIC admits the allegations of Paragraph 9.
10. WB Properties is a New York corporation with a principal place of business
located at 47-05 Metropolitan Avenue, Ridgewood, New York, 11385. WB Properties is
authorized to and does transact business in the State of New York.
ANSWER: FSIC admits the allegations of Paragraph 10.
11. WB Retail is a New York corporation with a principal place of business located at
47-05 Metropolitan Avenue, Ridgewood, New York, 11385. WB Retail is authorized to and
does transact business in the State of New York.
ANSWER: FSIC admits the allegations of Paragraph 11.
JURISDICTION AND VENUE
12. This Court has jurisdiction under CPLR Section 3001, which provides for
exclusive jurisdiction over declaratory judgment proceedings. An actual controversy exists
among the parties to this action pertaining to the interpretation of the terms and conditions of
insurance policy issued by First Specialty.
ANSWER: To the extent the allegations of Paragraph 12 set forth legal conclusions,
no response is required. To the extent a response is required, FSIC admits the allegations of
Paragraph 12.
13. This Court has personal jurisdiction over defendants pursuant to CPLR Sections
301 and 302.
ANSWER: To the extent certain allegations of Paragraph 13 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. To the extent the allegations of
Paragraph 13 set forth legal conclusions, no response is required. To the extent a response is
required, upon information and belief, FSIC admits the allegations of Paragraph 13.
14. Venue lies in the Supreme Court of New York, County of New York, under
CPLR Section 503(a) as at least one of the parties resides in the County of New York.
ANSWER: To the extent the allegations of Paragraph 14 set forth legal conclusions,
no response is required. To the extent a response is required, FSIC admits the allegations of
Paragraph 14.
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The Underlying Action
15. This matter arises out of an accident that allegedly occurred on or about August
14, 2015, at a retail premises leased to WB Retail by Serota, located at 322 Nassau Road,
"Premises"
Roosevelt, New York, 11575 (the "Premises"). On that date, the Claimant, Desmond Garrett,
allegedly tripped and fell on the sidewalk in front of the Premises before entering the store.
ANSWER: Upon information and belief, FSIC admits that, on August 14, 2015, Mr.
Garrett tripped and fell on the sidewalk adjacent to the Western Beef Supermarket located at the
Premises. FSIC lacks knowledge or information sufficient to form a belief regarding whether
store."
Mr. Garrett tripped and fell "before entering the FSIC denies that Mr. Garrett's injury
occurred at the premises leased to WB Retail.
16. On or about March 14, 2016, the Claimant filed the Underlying Action against
"A."
Serota and Western Beef. A copy of the complaint is attached hereto as Exhibit
ANSWER: FSIC admits the allegations of Paragraph 16.
17. The complaint in the Underlying Action alleges, inter alia, that the Claimant was
sidewalk"
"caused to fall due to the defective condition of the where he was walking, located in
front of the Premises. The Claimant alleges that his injuries were due to Serota's and Western
Beef's negligence.
ANSWER: FSIC admits the allegations of Paragraph 17.
Appointment of Counsel for Serota and Western Beef
18. Upon information and belief, Broadspire is the third-party administrator for
Western Beef and First Specialty under the commercial general liability policy issued by First
Specialty to Cactus Holdings, Inc. under policy number IRA 2000002 02, effective November
15, 2014 to November 15, 2015, with limits of $1,000,000 per occurrence and $2,000,000 in the
Policy"
aggregate, subject to a $450,000 Self-Insured Retention (the "First Specialty Policy").
ANSWER: To the extent certain allegations of Paragraph 18 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that Broadspire is the
third-party administrator for FSIC. FSIC admits the remaining allegations of Paragraph 18.
19. Upon information and belief, Broadspire, with First Specialty's and Western Beef
s knowledge and consent, appointed the law firm Robert E. Brown, P.C. (the "Brown Law
Firm") as counsel for Serota and Western Beef in the Underlying Action.
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ANSWER: To the extent certain allegations of Paragraph 19 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it had knowledge
of or consented to the appointment of the Brown Law Firm as counsel for Serota and Western
Beef. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining
allegations of Paragraph 19.
20. Broadspire, First Specialty and Western Beef did not ask for Serota's permission
for the joint representation and did not obtain a conflict waiver from Serota for it to be jointly
defended with Western Beef in the Underlying Action.
ANSWER: To the extent certain allegations of Paragraph 20 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not ask for
Serota's permission for the joint representation of Serota and Western Beef by the Brown Law
Firm because FSIC did not appoint the Brown Law Firm to represent Serota or Western Beef.
FSIC admits that it did not obtain a conflict waiver from Serota for itto be jointly represented
with Westem Beef because FSIC did not appoint the Brown Law Firm to represent Serota or
Western Beef. Because FSIC did not defend Serota, FSIC denies that it had any duty to (1) ask
for Serota's permission for the joint representation of Serota and Western Beef, or (2) obtain a
conflict waiver from Serota. FSIC lacks knowledge or information sufficient to form a belief
regarding the remaining allegations of Paragraph 20.
21. Neither before nor after appointing the Brown Law Firm to represent Serota did
Broadspire, First Specialty or Western Beef issue a reservation of rights letter. Indeed, they
issued no written correspondence to Serota detailing the terms of their assumption and control of
its defense.
ANSWER: To the extent certain allegations of Paragraph 21 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not issue a
reservation of rights letter or any other written correspondence to Serota, but denies that it had
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any duty to do so. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 21.
22. When Zurich learned of the Brown Law Firm's joint representation, it repeatedly
contacted Broadspire to confirm that Broadspire, First Specialty and Western Beef had agreed to
defend and indemnify Serota in the Underlying Action up to the full limits of the First Specialty
Policy.
ANSWER: FSIC lacks knowledge or information sufficient to form a belief regarding
the allegations of Paragraph 22.
23. Broadspire never responded to Zurich's inquiries.
ANSWER: To the extent certain allegations of Paragraph 23 are directed at
Broadspire, no response is required from FSIC. FSIC lacks knowledge or information sufficient
to form a belief regarding the allegations of Paragraph 23.
The Management of Serota's Defense
24. Throughout the litigation, the Brown Law Firm reported to and took instruction
from Broadspire, First Specialty and Western Beef.
ANSWER: To the extent certain allegations of Paragraph 24 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. To the extent a further response is
required, FSIC admits that the Brown Law Firm communicated with FSIC during the Underlying
Action, but FSIC denies that the Brown Law Firm took instruction from FSIC. FSIC lacks
knowledge or information sufficient to form a belief as to what Zurich means by the phrase
to,"
"reported as used in Paragraph 24, as that phrase is undefined and could have multiple
meanings. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 24.
25. Meanwhile, the Brown Law Firm, Broadspire, First Specialty and Western Beef
provided no status reports or updates to Serota or Zurich.
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ANSWER: To the extent certain allegations of Paragraph 25 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not provide
any status reports or updates to Serota or Zurich during the Underlying Action, but FSIC denies
any duty to do so. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 25.
26. Because Defendants and Broadspire caused the Brown Law Firm to jointly defend
Western Beef and Serota and controlled their defense, the Brown Law Firm did not and could
not assert a cross-claim for common law or contractual indemnification or contribution on behalf
of Serota against Western Beef.
ANSWER: To the extent certain allegations of Paragraph 26 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it caused the
Brown Law Firm to jointly defend Western Beef and Serota. FSIC also denies that it controlled
their defense. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 26.
27. Because Defendants and Broadspire caused the Brown Law Firm to jointly defend
Western Beef and Serota and controlled their defense, the Brown Law Firm could not and did
not file a motion for summary judgment on behalf of Serota against Western Beef for
indemnification.
ANSWER: To the extent certain allegations of Paragraph 27 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it caused the
Brown Law Firm to jointly defend Western Beef and Serota. FSIC also denies that it controlled
their defense. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 27.
28. And because Defendants and Broadspire caused the Brown Law Firm to jointly
defend Western Beef and Serota and controlled their defense, the Brown Law Firm could not and
did not seek to develop facts or steer the case strategy to focus on Western Beef's liability for the
Underlying Action.
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ANSWER: To the extent certain allegations of Paragraph 28 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it caused the
Brown Law Firm to jointly defend Western Beef and Serota. FSIC also denies that it controlled
their defense. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 28.
29. To that end, the Brown Law Firm did not produce Serota for a deposition and did
not produce any Western Beef employees for a deposition to demonstrate that Western Beef was
responsible, in whole or in part, for the accident. Nor could it, as the Brown Law Firm was
under Broadspire's, First Specialty's and Western Beefs control.
ANSWER: To the extent certain allegations of Paragraph 29 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that the Brown Law
Firm was under FSIC's control. FSIC lacks knowledge or information sufficient to form a belief
regarding the remaining allegations of Paragraph 29.
30. Not only did Defendants fail to produce Serota for a deposition, but at no point
before the case was sent out for trial did the Brown Law Firm contact Serota to discuss (a)
ownership of the location of the sidewalk where the accident occurred, (b) Western Beefs
obligations under the lease, (c) Serota's obligations under the lease, (d) Serota's perspective on
its liability for the Underlying Action, or (e) the potential liability of third parties, such as the
Town of Hempstead.
ANSWER: To the extent certain allegations of Paragraph 30 are directed at Western
Beef, no response is required from FSIC. FSIC admits that it did not produce Serota for a
deposition, but denies that it had any duty to do so. FSIC also admits that it did not contact
Serota to discuss the issues identified as (a) through (e) in Paragraph 30, but denies that it had
any duty to do so. FSIC lacks knowledge or information sufficient to form a belief regarding the
remaining allegations of Paragraph 30.
31. Upon information and belief, the Brown Law Firm did not believe any of the
aforementioned investigation and discovery was necessary in light of Broadspire's, First
Specialty's and Western Beefs agreement to indemnify Serota for the Underlying Action and its
view that Western Beef, not Serota, was liable for the accident.
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ANSWER: To the extent certain allegations of Paragraph 31 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it agreed to
indemnify Serota for the Underlying Action. FSIC lacks knowledge or information sufficient to
form a belief regarding the remaining allegations of Paragraph 31.
32. Consistent with that belief, when the parties to the Underlying Action participated
in a mediation, neither Serota nor Zurich were made aware of it or asked to participate. Instead,
Broadspire, First Specialty and Western Beef controlled the settlement discussions. Yet they
failed to even make an offer to the Claimant, causing the case to proceed to the very trial at
which Defendants abandoned Serota.
ANSWER: To the extent certain allegations of Paragraph 32 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC admits that itdid not make an
offer to the Claimant, but FSIC denies that it had any duty to do so. FSIC denies that it
controlled the settlement discussions at mediation in the Underlying Lawsuit, and denies that it
"abandoned"
had any duty to do so. FSIC denies Zurich's characterization that FSIC Serota.
FSIC lacks knowledge or information sufficient to form a belief regarding the remaining
allegations of Paragraph 32.
Broadspire, First Specialty and Western Beef Abandon Serota
33. Because Broadspire, First Specialty and Western Beef were in full control of
Serota's defense and indemnity, neither Zurich nor Serota received any updates regarding the
status of the Underlying Action, that is,until December 5, 2017.
ANSWER: To the extent certain allegations of Paragraph 33 are directed at Western
Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not provide
Zurich or Serota with updates regarding the status of the Underlying Action, but FSIC denies that
it had any duty to do so. FSIC denies that it controlled Serota's defense and indemnity in the
Underlying Lawsuit. FSIC specifically denies Zurich's characterization that FSIC was "in full
control"
of Serota's defense and indemnity. FSIC lacks knowledge or information sufficient to
form a belief regarding the remaining allegations of Paragraph 33.
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34. On that date -- the first of trial -- the Brown Law Firm notified Zurich and
day
Serota that itcould no longer represent Serota.
ANSWER: Upon information and belief, FSIC denies the allegations of Paragraph 34.
Upon information and belief, on December 3, 2018, the Brown Law Firm notified Zurich and
Serota that itcould no longer represent Serota.
35. The Brown Law Firm advised Zurich and Serota that Western Beef had retained
the law firm Abrams Fensterman as itsnew outside general counsel and an attorney at the firm,
Anthony Genovesi, Esq., had concluded that Serota, not Western Beef, was liable for the
accident.
ANSWER: Upon information and belief, FSIC admits that Abrams Fensterman was
retained by Western Beef in the Underlying Lawsuit. FSIC lacks knowledge or information
sufficient to form a belief regarding the remaining allegations of Paragraph 35.
36. Mr. Genovesi relied on the facts developed by Western Beefs appointed counsel,
who, under Western Beef's control, shaped the course of discovery and determined case strategy.
ANSWER: FSIC lacks knowledge or information sufficient to form a belief regarding
the remaining allegations of Paragraph 36.
37. Adding insult to injury, Western Beef demanded that Serota enter into an
indemnification agreement where Serota would indemnify Western Beef for any liability it may
have in the Underlying Action.
ANSWER: To the extent certain allegations of Paragraph 37 are directed at Western
Beef, no response is required from FSIC. Upon information and belief, FSIC admits that
Western Beef attempted to negotiate an indemnification agreement with Serota. FSIC lacks
knowledge or information sufficient to form a belief regarding Zurich's characterization of those
negotiations as set forth in Paragraph 37.
38. Zurich, as Serota's commercial general liability insurer, declined Western Beef's
request for an indemnification agreement, but because trialwas scheduled to begin, Zurich and
Serota permitted the Brown Law Firm to continue to represent Serota.
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ANSWER: Upon information and belief, FSIC admits that Zurich is Serota's
commercial general liability insurer. Upon information and belief, FSIC admits that Zurich
declined to have Serota enter into an indemnification agreement with Western Beef. Upon
information and belief, Zurich and Serota permitted the Brown Law Firm to continue to
represent Serota through trial in the Underlying Action. FSIC lacks knowledge or information
sufficient to form a belief as to the remaining allegations and characterizations of Paragraph 38
because, upon information and belief, FSIC was not a party to all of the communications
between Zurich and Western Beef.
39. Zurich immediately informed Western Beef that its abandonment of Serota's
defense and indemnity was improper and that itwas equitably estopped from deserting Serota.
ANSWER: To the extent certain allegations of Paragraph 39 are directed at Western
Beef, no response is required from FSIC. Upon information and belief, FSIC admits that Zurich
sent Western Beef written communication during the pendency of the Underlying Action, and
the content of that communication or those communications speak for themselves. Upon
information and belief, FSIC lacks knowledge or information sufficient to form a belief as to the
remaining allegations and characterizations of Paragraph 39 because, upon information and
belief, FSIC was not a party to all of the communications between Zurich and Western Beef.
40. Unmoved, Western Beef declined to reconsider its position, declined to make a
meaningful effort to settle the case, and caused Serota to proceed to trial, resulting in a liability
verdict against Serota and an award of damages of $295,000.
ANSWER: To the extent certain allegations of Paragraph 40 are directed at Western
Beef, no response is required from FSIC. FSIC admits that the court in the Underlying Action
entered a judgment against Serota in the amount of $295,000 plus interest of $5,382.74 and
disbursements of $1,405.00, which total $301,784.74. FSIC lacks knowledge or information
sufficient to form a belief as to the remaining allegations and characterizations of Paragraph 40.
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The Western Beef Lease
41. On August 3, 2004, Serota, as Landlord, entered into a five-year lease with
Western Beef, as tenant, for the Demised Premises, which is described within the Lease as that
"Lease"
portion of the building located at 332 Nassau Road, Roosevelt, New York 11575 (the "Lease").
A copy of the lease is attached as Exhibit "B".
ANSWER: Upon information and belief, FSIC admits that Serota, as landlord, entered
into a lease with Western Beef, as tenant, for the Demised Premises, which is described within
the Lease as that portion of the building located at 332 Nassau Road, Roosevelt, New York
11575. FSIC lacks knowledge or information to form a belief as to whether the copy of the lease
"B"
attached to Zurich's Complaint for Declaratory Relief and Damages as Exhibit accurately
represents the entire agreement between Serota and Western Beef.
42. Article 8 of the Lease, entitled "Tenant's Liability Property Loss, Damage,
Liability,"
states in relevant part:
Owner or itsagents shall not be liable...for any injury or damage to
persons or property resulting from any cause of whatsoever nature,
unless caused by or due to the negligence of Owner, its agents,
servants or employees. Owner or its agents will not be liable for
any such damage caused by other tenants or persons in, upon or
Preview
FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ZURICH AMERICAN INSURANCE COMPANY, Index No. 652336/2018 Plaintiffs, -against- FIRST SPECIALTY INSURANCE CORPORATION'S ANSWER, FIRST SPECIALTY INSURANCE CORPORATION AFFIRMATIVE DEFENSES, AND WESTERN BEEF RETAIL, INC. and WESTERN BEEF COUNTERCLAIM PROPERTIES, INC., Defendants. First Specialty Insurance Corporation ("FSIC") responds to the allegations of the ("Zurich" Complaint for Declaratory Judgment filed by Zurich American Insurance Company ("Zurich"), and asserts Affirmative Defenses as set forth below. NATURE OF THE ACTION Defendants' 1. This declaratory judgment and breach of contract action arises from abandonment of Zurich's insured, Serota Roosevelt LLC ("Serota"), on the first day of trial in a personal injury lawsuit styled Desmond Garrett v. Serota Roosevelt LLC, et al., bearing Index Action" No. 702978/2016 (the "Underlying Action"). ANSWER: FSIC admits that this action arises from a personal injury suit styled Desmond Garrett v. Serota Roosevelt LLC, et al., bearing Index No. 702978/2016 and designated Action." herein as the "Underlying FSIC denies that it owed a duty to defend Serota Roosevelt LLC ("Serota"). FSIC also denies Zurich's characterization that FSIC abandoned Serota at trial in the Underlying Lawsuit. FSIC denies the remaining allegations of Paragraph 1. 2. Desmond Garrett sued Serota, WB Retail, and WB Properties (WB Retail and Beef" WB Properties are collectively referred to as "Western Beef") for a trip and fallthat occurred on the sidewalk outside the Western Beef supermarket located at 322 Nassau Road, Roosevelt, New "Premises" York, 11575 (the "Premises") before he entered the store. ANSWER: FSIC lacks knowledge or information sufficient to form a belief regarding store." whether Mr. Garrett tripped and fell "before he entered the FSIC admits the remaining allegations of Paragraph 2. 1 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 3. Without so much as a tender, First Specialty, WB Retail, WB Properties, and their third-party administrator, Broadspire, promptly assumed Serota's defense for the Underlying Action. They issued no reservation of rights and appointed a single law firm to jointly represent Serota, the landlord, and Western Beef, the tenant. ANSWER: To the extent certain allegations of Paragraph 3 are directed at Western Beef and/or Broadspire, no response is required from FSIC. To the extent a response is required, upon information and belief, FSIC admits that Western Beef appointed a law firm to represent Serota and Western Beef in the Underlying Lawsuit. FSIS admits that it did not issue a reservation of rights to Serota, but FSIC denies that it had any duty to do so. FSIC denies that it assumed Serota's defense for the Underlying Lawsuit. FSIC denies that it appointed a law firm to represent Serota or Western Beef. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 3. Defendants' 4. That law firm, under direction and control, steered Serota and Western Beef through discovery, determined the case strategy, engaged in settlement discussions on Serota's behalf, and planned on try the case. ANSWER: To the extent certain allegations of Paragraph 4 are directed at Western Beef, no response is required from FSIC. To the extent a response is required, upon information and belief, FSIC admits that the law firm appointed by Western Beef represented Serota and Western Beef in the Underlying Lawsuit. FSIC lacks knowledge and information sufficient to form a belief regarding Zurich's characterization of that representation. FSIC denies that the law firm representing Serota and Western Beef acted under FSIC's direction or control. 5. On the first day of trial,Defendants invoked the factual record their appointed counsel developed to break their agreement to defend and indemnify Serota, claiming that Serota, not Western Beef, was liable for the accident. They demanded that Serota and its commercial general liability insurer, Zurich, settle the case, and that Serota agree to indemnify Western Beef. Zurich and Serota refused this prejudicial demand and urged Defendants to reconsider their position in light to the clear harm they had caused to Serota and to Zurich. Defendants were well aware that until Western Beefs eve of trial demand, Zurich had not been involved in the case, having closed its file more than a year earlier after being advised that Defendants has retained counsel for Serota. 2 2 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 ANSWER: To the extent certain allegations of Paragraph 5 are directed at Western Beef, no response is required from FSIC. To the extent a response is required, FSIC denies the allegations of Paragraph 5. 6. Defendants refused, forced Serota to try the case, and used the factual record their counsel developed to shift liability onto Serota, resulting in a $295,000 verdict against it. ANSWER: To the extent certain allegations of Paragraph 6 are directed at Western Beef, no response is required from FSIC. To the extent a response is required, FSIC admits that a judgment was entered against Serota in the amount of $295,000 plus interest of $5,382.74 and disbursements of $1,405.00, which total $301,784.74. FSIC denies the remaining allegations of Paragraph 6. 7. Serota and Zurich bring this suit to compel Defendants to honor their agreement to defend and indemnify Serota and to obtain reimbursement of the costs they have expended Defendants' and will expend as a result of wrongful abandonment. ANSWER: FSIC admits that Zurich has filed the instant lawsuit against the Defendants. FSIC lacks knowledge or information sufficient to form a belief regarding Zurich's reasons for filing the instant lawsuit. THE PARTIES 8. Zurich is a New York corporation engaged in the insurance business with a statutory home office located at 4 World Trade Center, 150 Greenwich Street, New York, New York 10007, and a principal place of business located at 1299 Zurich Way, Schaumburg, Illinois 60196. ANSWER: Upon information and belief, FSIC admits that Zurich has a principal place of business located at 1299 Zurich Way, Schaumburg, Illinois 60196. FSIC lacks knowledge and information sufficient to form a belief regarding the remaining allegations of Paragraph 8. 9. First Specialty is a Missouri corporation engaged in the insurance business with an administrative office located at 5200 Metcalf Avenue, Overland Park, KS 66202. First 3 3 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 Specialty is authorized to, and does engage in the business of insurance in New York through licensed wholesale brokers as a non-admitted insurer. ANSWER: FSIC admits the allegations of Paragraph 9. 10. WB Properties is a New York corporation with a principal place of business located at 47-05 Metropolitan Avenue, Ridgewood, New York, 11385. WB Properties is authorized to and does transact business in the State of New York. ANSWER: FSIC admits the allegations of Paragraph 10. 11. WB Retail is a New York corporation with a principal place of business located at 47-05 Metropolitan Avenue, Ridgewood, New York, 11385. WB Retail is authorized to and does transact business in the State of New York. ANSWER: FSIC admits the allegations of Paragraph 11. JURISDICTION AND VENUE 12. This Court has jurisdiction under CPLR Section 3001, which provides for exclusive jurisdiction over declaratory judgment proceedings. An actual controversy exists among the parties to this action pertaining to the interpretation of the terms and conditions of insurance policy issued by First Specialty. ANSWER: To the extent the allegations of Paragraph 12 set forth legal conclusions, no response is required. To the extent a response is required, FSIC admits the allegations of Paragraph 12. 13. This Court has personal jurisdiction over defendants pursuant to CPLR Sections 301 and 302. ANSWER: To the extent certain allegations of Paragraph 13 are directed at Western Beef and/or Broadspire, no response is required from FSIC. To the extent the allegations of Paragraph 13 set forth legal conclusions, no response is required. To the extent a response is required, upon information and belief, FSIC admits the allegations of Paragraph 13. 14. Venue lies in the Supreme Court of New York, County of New York, under CPLR Section 503(a) as at least one of the parties resides in the County of New York. ANSWER: To the extent the allegations of Paragraph 14 set forth legal conclusions, no response is required. To the extent a response is required, FSIC admits the allegations of Paragraph 14. 4 4 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 The Underlying Action 15. This matter arises out of an accident that allegedly occurred on or about August 14, 2015, at a retail premises leased to WB Retail by Serota, located at 322 Nassau Road, "Premises" Roosevelt, New York, 11575 (the "Premises"). On that date, the Claimant, Desmond Garrett, allegedly tripped and fell on the sidewalk in front of the Premises before entering the store. ANSWER: Upon information and belief, FSIC admits that, on August 14, 2015, Mr. Garrett tripped and fell on the sidewalk adjacent to the Western Beef Supermarket located at the Premises. FSIC lacks knowledge or information sufficient to form a belief regarding whether store." Mr. Garrett tripped and fell "before entering the FSIC denies that Mr. Garrett's injury occurred at the premises leased to WB Retail. 16. On or about March 14, 2016, the Claimant filed the Underlying Action against "A." Serota and Western Beef. A copy of the complaint is attached hereto as Exhibit ANSWER: FSIC admits the allegations of Paragraph 16. 17. The complaint in the Underlying Action alleges, inter alia, that the Claimant was sidewalk" "caused to fall due to the defective condition of the where he was walking, located in front of the Premises. The Claimant alleges that his injuries were due to Serota's and Western Beef's negligence. ANSWER: FSIC admits the allegations of Paragraph 17. Appointment of Counsel for Serota and Western Beef 18. Upon information and belief, Broadspire is the third-party administrator for Western Beef and First Specialty under the commercial general liability policy issued by First Specialty to Cactus Holdings, Inc. under policy number IRA 2000002 02, effective November 15, 2014 to November 15, 2015, with limits of $1,000,000 per occurrence and $2,000,000 in the Policy" aggregate, subject to a $450,000 Self-Insured Retention (the "First Specialty Policy"). ANSWER: To the extent certain allegations of Paragraph 18 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that Broadspire is the third-party administrator for FSIC. FSIC admits the remaining allegations of Paragraph 18. 19. Upon information and belief, Broadspire, with First Specialty's and Western Beef s knowledge and consent, appointed the law firm Robert E. Brown, P.C. (the "Brown Law Firm") as counsel for Serota and Western Beef in the Underlying Action. 5 5 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 ANSWER: To the extent certain allegations of Paragraph 19 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it had knowledge of or consented to the appointment of the Brown Law Firm as counsel for Serota and Western Beef. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 19. 20. Broadspire, First Specialty and Western Beef did not ask for Serota's permission for the joint representation and did not obtain a conflict waiver from Serota for it to be jointly defended with Western Beef in the Underlying Action. ANSWER: To the extent certain allegations of Paragraph 20 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not ask for Serota's permission for the joint representation of Serota and Western Beef by the Brown Law Firm because FSIC did not appoint the Brown Law Firm to represent Serota or Western Beef. FSIC admits that it did not obtain a conflict waiver from Serota for itto be jointly represented with Westem Beef because FSIC did not appoint the Brown Law Firm to represent Serota or Western Beef. Because FSIC did not defend Serota, FSIC denies that it had any duty to (1) ask for Serota's permission for the joint representation of Serota and Western Beef, or (2) obtain a conflict waiver from Serota. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 20. 21. Neither before nor after appointing the Brown Law Firm to represent Serota did Broadspire, First Specialty or Western Beef issue a reservation of rights letter. Indeed, they issued no written correspondence to Serota detailing the terms of their assumption and control of its defense. ANSWER: To the extent certain allegations of Paragraph 21 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not issue a reservation of rights letter or any other written correspondence to Serota, but denies that it had 6 6 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 any duty to do so. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 21. 22. When Zurich learned of the Brown Law Firm's joint representation, it repeatedly contacted Broadspire to confirm that Broadspire, First Specialty and Western Beef had agreed to defend and indemnify Serota in the Underlying Action up to the full limits of the First Specialty Policy. ANSWER: FSIC lacks knowledge or information sufficient to form a belief regarding the allegations of Paragraph 22. 23. Broadspire never responded to Zurich's inquiries. ANSWER: To the extent certain allegations of Paragraph 23 are directed at Broadspire, no response is required from FSIC. FSIC lacks knowledge or information sufficient to form a belief regarding the allegations of Paragraph 23. The Management of Serota's Defense 24. Throughout the litigation, the Brown Law Firm reported to and took instruction from Broadspire, First Specialty and Western Beef. ANSWER: To the extent certain allegations of Paragraph 24 are directed at Western Beef and/or Broadspire, no response is required from FSIC. To the extent a further response is required, FSIC admits that the Brown Law Firm communicated with FSIC during the Underlying Action, but FSIC denies that the Brown Law Firm took instruction from FSIC. FSIC lacks knowledge or information sufficient to form a belief as to what Zurich means by the phrase to," "reported as used in Paragraph 24, as that phrase is undefined and could have multiple meanings. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 24. 25. Meanwhile, the Brown Law Firm, Broadspire, First Specialty and Western Beef provided no status reports or updates to Serota or Zurich. 7 7 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 ANSWER: To the extent certain allegations of Paragraph 25 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not provide any status reports or updates to Serota or Zurich during the Underlying Action, but FSIC denies any duty to do so. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 25. 26. Because Defendants and Broadspire caused the Brown Law Firm to jointly defend Western Beef and Serota and controlled their defense, the Brown Law Firm did not and could not assert a cross-claim for common law or contractual indemnification or contribution on behalf of Serota against Western Beef. ANSWER: To the extent certain allegations of Paragraph 26 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it caused the Brown Law Firm to jointly defend Western Beef and Serota. FSIC also denies that it controlled their defense. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 26. 27. Because Defendants and Broadspire caused the Brown Law Firm to jointly defend Western Beef and Serota and controlled their defense, the Brown Law Firm could not and did not file a motion for summary judgment on behalf of Serota against Western Beef for indemnification. ANSWER: To the extent certain allegations of Paragraph 27 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it caused the Brown Law Firm to jointly defend Western Beef and Serota. FSIC also denies that it controlled their defense. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 27. 28. And because Defendants and Broadspire caused the Brown Law Firm to jointly defend Western Beef and Serota and controlled their defense, the Brown Law Firm could not and did not seek to develop facts or steer the case strategy to focus on Western Beef's liability for the Underlying Action. 8 8 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 ANSWER: To the extent certain allegations of Paragraph 28 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it caused the Brown Law Firm to jointly defend Western Beef and Serota. FSIC also denies that it controlled their defense. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 28. 29. To that end, the Brown Law Firm did not produce Serota for a deposition and did not produce any Western Beef employees for a deposition to demonstrate that Western Beef was responsible, in whole or in part, for the accident. Nor could it, as the Brown Law Firm was under Broadspire's, First Specialty's and Western Beefs control. ANSWER: To the extent certain allegations of Paragraph 29 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that the Brown Law Firm was under FSIC's control. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 29. 30. Not only did Defendants fail to produce Serota for a deposition, but at no point before the case was sent out for trial did the Brown Law Firm contact Serota to discuss (a) ownership of the location of the sidewalk where the accident occurred, (b) Western Beefs obligations under the lease, (c) Serota's obligations under the lease, (d) Serota's perspective on its liability for the Underlying Action, or (e) the potential liability of third parties, such as the Town of Hempstead. ANSWER: To the extent certain allegations of Paragraph 30 are directed at Western Beef, no response is required from FSIC. FSIC admits that it did not produce Serota for a deposition, but denies that it had any duty to do so. FSIC also admits that it did not contact Serota to discuss the issues identified as (a) through (e) in Paragraph 30, but denies that it had any duty to do so. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 30. 31. Upon information and belief, the Brown Law Firm did not believe any of the aforementioned investigation and discovery was necessary in light of Broadspire's, First Specialty's and Western Beefs agreement to indemnify Serota for the Underlying Action and its view that Western Beef, not Serota, was liable for the accident. 9 9 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 ANSWER: To the extent certain allegations of Paragraph 31 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC denies that it agreed to indemnify Serota for the Underlying Action. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 31. 32. Consistent with that belief, when the parties to the Underlying Action participated in a mediation, neither Serota nor Zurich were made aware of it or asked to participate. Instead, Broadspire, First Specialty and Western Beef controlled the settlement discussions. Yet they failed to even make an offer to the Claimant, causing the case to proceed to the very trial at which Defendants abandoned Serota. ANSWER: To the extent certain allegations of Paragraph 32 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC admits that itdid not make an offer to the Claimant, but FSIC denies that it had any duty to do so. FSIC denies that it controlled the settlement discussions at mediation in the Underlying Lawsuit, and denies that it "abandoned" had any duty to do so. FSIC denies Zurich's characterization that FSIC Serota. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 32. Broadspire, First Specialty and Western Beef Abandon Serota 33. Because Broadspire, First Specialty and Western Beef were in full control of Serota's defense and indemnity, neither Zurich nor Serota received any updates regarding the status of the Underlying Action, that is,until December 5, 2017. ANSWER: To the extent certain allegations of Paragraph 33 are directed at Western Beef and/or Broadspire, no response is required from FSIC. FSIC admits that it did not provide Zurich or Serota with updates regarding the status of the Underlying Action, but FSIC denies that it had any duty to do so. FSIC denies that it controlled Serota's defense and indemnity in the Underlying Lawsuit. FSIC specifically denies Zurich's characterization that FSIC was "in full control" of Serota's defense and indemnity. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 33. 10 10 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 34. On that date -- the first of trial -- the Brown Law Firm notified Zurich and day Serota that itcould no longer represent Serota. ANSWER: Upon information and belief, FSIC denies the allegations of Paragraph 34. Upon information and belief, on December 3, 2018, the Brown Law Firm notified Zurich and Serota that itcould no longer represent Serota. 35. The Brown Law Firm advised Zurich and Serota that Western Beef had retained the law firm Abrams Fensterman as itsnew outside general counsel and an attorney at the firm, Anthony Genovesi, Esq., had concluded that Serota, not Western Beef, was liable for the accident. ANSWER: Upon information and belief, FSIC admits that Abrams Fensterman was retained by Western Beef in the Underlying Lawsuit. FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 35. 36. Mr. Genovesi relied on the facts developed by Western Beefs appointed counsel, who, under Western Beef's control, shaped the course of discovery and determined case strategy. ANSWER: FSIC lacks knowledge or information sufficient to form a belief regarding the remaining allegations of Paragraph 36. 37. Adding insult to injury, Western Beef demanded that Serota enter into an indemnification agreement where Serota would indemnify Western Beef for any liability it may have in the Underlying Action. ANSWER: To the extent certain allegations of Paragraph 37 are directed at Western Beef, no response is required from FSIC. Upon information and belief, FSIC admits that Western Beef attempted to negotiate an indemnification agreement with Serota. FSIC lacks knowledge or information sufficient to form a belief regarding Zurich's characterization of those negotiations as set forth in Paragraph 37. 38. Zurich, as Serota's commercial general liability insurer, declined Western Beef's request for an indemnification agreement, but because trialwas scheduled to begin, Zurich and Serota permitted the Brown Law Firm to continue to represent Serota. 11 11 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 ANSWER: Upon information and belief, FSIC admits that Zurich is Serota's commercial general liability insurer. Upon information and belief, FSIC admits that Zurich declined to have Serota enter into an indemnification agreement with Western Beef. Upon information and belief, Zurich and Serota permitted the Brown Law Firm to continue to represent Serota through trial in the Underlying Action. FSIC lacks knowledge or information sufficient to form a belief as to the remaining allegations and characterizations of Paragraph 38 because, upon information and belief, FSIC was not a party to all of the communications between Zurich and Western Beef. 39. Zurich immediately informed Western Beef that its abandonment of Serota's defense and indemnity was improper and that itwas equitably estopped from deserting Serota. ANSWER: To the extent certain allegations of Paragraph 39 are directed at Western Beef, no response is required from FSIC. Upon information and belief, FSIC admits that Zurich sent Western Beef written communication during the pendency of the Underlying Action, and the content of that communication or those communications speak for themselves. Upon information and belief, FSIC lacks knowledge or information sufficient to form a belief as to the remaining allegations and characterizations of Paragraph 39 because, upon information and belief, FSIC was not a party to all of the communications between Zurich and Western Beef. 40. Unmoved, Western Beef declined to reconsider its position, declined to make a meaningful effort to settle the case, and caused Serota to proceed to trial, resulting in a liability verdict against Serota and an award of damages of $295,000. ANSWER: To the extent certain allegations of Paragraph 40 are directed at Western Beef, no response is required from FSIC. FSIC admits that the court in the Underlying Action entered a judgment against Serota in the amount of $295,000 plus interest of $5,382.74 and disbursements of $1,405.00, which total $301,784.74. FSIC lacks knowledge or information sufficient to form a belief as to the remaining allegations and characterizations of Paragraph 40. 12 12 of 48 FILED: NEW YORK COUNTY CLERK 08/02/2018 03:16 PM INDEX NO. 652336/2018 NYSCEF DOC. NO. 10 RECEIVED NYSCEF: 08/02/2018 The Western Beef Lease 41. On August 3, 2004, Serota, as Landlord, entered into a five-year lease with Western Beef, as tenant, for the Demised Premises, which is described within the Lease as that "Lease" portion of the building located at 332 Nassau Road, Roosevelt, New York 11575 (the "Lease"). A copy of the lease is attached as Exhibit "B". ANSWER: Upon information and belief, FSIC admits that Serota, as landlord, entered into a lease with Western Beef, as tenant, for the Demised Premises, which is described within the Lease as that portion of the building located at 332 Nassau Road, Roosevelt, New York 11575. FSIC lacks knowledge or information to form a belief as to whether the copy of the lease "B" attached to Zurich's Complaint for Declaratory Relief and Damages as Exhibit accurately represents the entire agreement between Serota and Western Beef. 42. Article 8 of the Lease, entitled "Tenant's Liability Property Loss, Damage, Liability," states in relevant part: Owner or itsagents shall not be liable...for any injury or damage to persons or property resulting from any cause of whatsoever nature, unless caused by or due to the negligence of Owner, its agents, servants or employees. Owner or its agents will not be liable for any such damage caused by other tenants or persons in, upon or