LMIII Realty, LLC v. Gemini Insurance

Plaintiffs commenced this action seeking a declaration that Gemini Insurance Company (defendant) is obligated to defend and indemnify plaintiff LMIII Realty, LLC (LMIII) as an additional insured in the underlying personal injury action. Defendant made a pre-answer motion to dismiss the complaint and, in the alternative, sought summary judgment declaring that it has no obligation to defend or indemnify plaintiffs because they do not qualify as additional insureds under the policy. Plaintiffs opposed the motion and in addition sought a declaration that plaintiffs qualify as additional insureds under the policy. Supreme Court denied defendant’s motion. Plaintiffs subsequently moved for leave to reargue defendant’s motion and sought summary judgment declaring that they are entitled to coverage from defendant as additional insureds. The court granted plaintiffs’ motion for leave to reargue on the ground that plaintiffs established that the court had “overlooked controlling law on this issue” and, upon reargument, searched

In the underlying action, a roofer employed by defendant Shaffer Building Services, Inc. (Shaffer) seeks damages for injuries he sustained during the course of his employment. LMIII hired Shaffer to replace a roof on its property, and Shaffer was insured under a commercial general liability policy issued by defendant. The policy’s additional insured endorsement provided that a third party may constitute an additional insured “when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy.”

We agree with defendant that, contrary to the court’s determination, the endorsement is not ambiguous on the issue whether an agreement to add an additional insured was required to be in writing. The term “in writing” refers to the entire phrase “in a contract or agreement,” not merely to the phrase “in a contract” (see Erin Constr. & Dev. Co., Inc. v Gulf Ins. Co., 2008 NY Slip Op 32046 [U] [2008]; see also Timmons v Barrett Paving Materials, Inc., 83 AD3d 1473 , 1477 [2011], lv dismissed in part and denied in part 17 NY3d 843 [2011]). We reject defendant’s contention, however, that there was no written agreement in this case. Indeed, the purchase order constituted a written agreement obligating Shaffer to add LMIII as an additional insured to the policy (see Timmons, 83 AD3d at 1477 ; see generally BP A.C. Corp. v One Beacon Ins. Group, 8 NY3d 708 , 712 [2007]). The purchase order was an enforceable agreement despite the fact that it was unsigned because the evidence in the record establishes that the parties intended to be bound by it (see Flores v Lower E. Side Serv. Ctr., Inc., 4 NY3d 363 , 369 [2005], rearg denied 5 NY3d 746 [2005]; Kay-Bee Toys Corp. v Winston Sports Corp., 214 AD2d 457 , 458 [1995], lv denied 86 NY2d 705 [1995]).

Nevertheless, we conclude that defendant is correct that the court erred in granting summary judgment to plaintiffs on all issues and in issuing the subject declaration, i.e., that defendant is obligated to defend and indemnify LMIII as an additional insured in the underlying action. Inasmuch as the record establishes that the parties deliberately charted a summary judgment course, the court properly granted summary judg