### Sterling Landlord Corp. v Axis Ins. Co. 2024 NY Slip Op 32955(U) August 20, 2024 Supreme Court, New York County Docket Number: Index No. 651800/2021 Judge: Suzanne Adams Cases posted with a "30000" identifier, i.e., 2013 NY Slip

Op 30001(U), are republished from various New York State and local government sources, including the New

York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication.NYSCEF DOC. NO. 51 INDEX NO. 651800/2021 RECEIVED NYSCEF: 08/20/2024

PRESENT: 

### SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY HON. SUZANNE ADAMS PART Justice 39M

-----------------------------------------------------------------------X INDEX NO. MOTION DATE 651800/2021 STERLING LANDLORD CORP., UNITED STATES REALTY & INVESTMENT COMPANY, C&I BROADWAY, LLC

- V - AXIS INSURANCE COMPANY, Plaintiff,

Defendant. -------X N/A MOTION SEQ. NO. 002
DECISION + ORDER ON MOTION

The following e-filed documents, listed by NYSCEF document number (Motion 002) 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39,40, 41,42, 43,44, 45,46,47,48, 49 were read on this motion to/for JUDGMENT - SUMMARY 

### Upon the foregoing documents, it is ordered that defendant's motion is denied and plaintiffs' cross-motionis granted. Plaintiffs in thisaction are the landlords ofthe premises at 1650 Broadway, New York, New York. Pursuant to a lease effective June 1, 2017, through May 31, 2027, non-party 1650 Broadway Associates Inc. ("Tenant") leased the premises. The lease provided that Tenant be responsible for taking good care of the premises and the adjacent sidewalks and keeping the sidewalks in good condition, and also that it obtain general liability insurance and name plaintiffs as additional insureds. Tenant procured a liability policy from defendant, who issued an insurance policy for Tenant effective June 17, 2019, through June 17, 2020, which, interalia, limited coverage to the premises as well as bodily injury arising out ofthe ownership, maintenance, or use ofthe premises and the operations necessary or incidental to the premises, and named plaintiffs as additional insureds. In 2019, a non-party individual allegedly tripped and fell on the sidewalk in front ofthe premises and brought suit against plaintiffs (and others) alleging the sidewalk was negligently

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## II maintained and was in a broken and unsafe condition. Plaintiffs sent a tender letter on or about September 18, 2020, to defendant seeking defense and indemnification in the underlying action, !· and commencedthis declaratoryjudgment action in March 2021. Defendantnowmovespursuant to CPLR 3212 for summaryjudgment dismissing the complaint and declaring it has no duty to indemnify ordefend plaintiffs in connectionto theunderlying action. Plaintiffs opposethe motion and cross-movepursuantto CPLR 3001 and 3212for summaryjudgmentdeclaring thatdefendant: (1) has a duty to defend and indemnifyplaintiffsinthe underlying action; and (2) must cover costs of defense payments by plaintiffs or plaintiffs' insurer for the underlying action, plus statutory interest. Defendant opposes the cross-motion. "The proponent of a summary judgment motion must make a primafacie showing of entitlementtojudgmentas a matter oflaw, tendering sufficient evidence to eliminate any material issues of fact from the case." Winegrad v. NY Univ. Med. Ctr., 64 N.Y.2d 851, 853 (1985) (citations omitted). Ifthe moving party meets their burden, the opposing party must produce evidentiary proofin admissible form that is sufficient to raise a triable issue offact. Zuckerman v City of New York, 49 N.Y.2d 557, 562 (1980). Further, "[a]ninsurer's duty to defend its insured is 'exceedingly broad.' An 'insurerwill be calledupon to provide adefense wheneverthe allegations in the complaint suggest ... a reasonable possibility ofcoverage.' 'If[a] complaint contains any facts or allegations which bring the claim even potentially within the protection purchased, the insurer is obligated to defend.' This standard applies equally to additional insureds and named insureds." Regal Constr. Corp. v National Union Fire Ins. Co. of Pittsburgh, PA, 15 N.Y.3d 34, 37 (2010) (citations omitted). Where an insured has an express duty to maintain the sidewalk outside its leased premises, and to indemnify the landlord, it can be reasonably inferred that an underlying accident onthe sidewalkin front ofthe leased premises arises from the maintenance of

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### the sidewalk. Wesco Ins. Co. v Rutgers Cas. Ins. Co., 202 A.D.3d 460 (l5t 

### Dep't 2022). Thus, where an insurance policy covers liability arising out ofthe ownership, maintenance, oruse ofthe part leased to a tenant, an additional insured endorsement covers claims arising out ofa defect on the sidewalk where a lease agreement obligates a tenant to keep the sidewalk in reasonably good condition. Tower Ins. Co. of New York v LeadingIns. Group Ins. Co., Ltd., 134 A.D.3d 510, 510 (1 st 

### Dep't2015). In fact, use ofthe sidewalk for access to a premises is an inextricablepart ofthe
use the premises so liability arising from the sidewalk use falls within an additional insured's coverage. ZKZAssoc. v CNA Ins. Co., 224 A.D.2d 174, 176 (1 st 

### Dep't 1996), affd89 N.Y.2d 990 (1997); see also New York Convention Ctr. Operating Corp. v Cerullo World Evangelism, 269 A.D.2d 275, 276 (1 st 

### Dep't 2000) (liability insurance includes "not only the premises specifically identified as covered, but also other space whose use was incidental to the use ofthe expressly covered premises"). Here, defendantfails to meetitsprima facie burden, inthatitfails to showthatthe sidewalk is not part of the covered premises and that plaintiffs are not entitled to additional insureds coverage. The policy at issue states that coverage applies to "bodily injury" claims arising out of "[t]he ownership, maintenance, or use ofthe premises
... and operations necessary or incidental to thosepremises[.]" Thepolicy itselfmakes no distinctionbetweenpersonswho use the sidewalk to enter or exit the premises and persons who use the sidewalk to pass by the premises. In either event, the adjacent sidewalkis an incidental part ofthe premises from which liability arising from its use squarely falls withinplaintiffs' additional insured coverage. Onthe otherhand, plaintiffs have mettheirprima facie burden, and defendant fails to raise
a triable issue offact that would preclude summary judgment. The personal injury claim in the underlying action arises out of the maintenance or use of the premises, which includes the

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sidewalk, that is within the covered language or events of the insurance policy. Since the underlying plaintiff's claim stems from covered instances inthe insurance policy, defendant has a duty to defend and indemnify plaintiffs in the underlying action, and defendant does not proffer
an exclusion clause to deny coverage. Accordingly, it is hereby ORDERED that defendant's motion is denied; and it is further ORDERED that plaintiffs' cross-motion is granted in its entirety; and it is further ORDERED, ADJUDGED, and DECREED that defendant owes a duty to defend and indemnify plaintiffs on a primary basis with respect to the underlying action captioned Pinto v. Sterling Landlord Corp., et al., pending in the Supreme Court, New York County, under Index No. 155178/2020; and itis further ORDEREDthatahearinginthismatterto determinethe amountofdefensepaymentsmade by plaintiffs or plaintiffs' insurer with respect to the underlying action, plus statutory interest and costs ofsuit, is referred to a Special Referee, and that within 60 days from the date ofthis order plaintiffshall cause a copy ofthis orderwith notice ofentry, including proofofservice thereof, to be filed with the Special Referee clerk (Room 119M, 646-386-3028 or spref@nycourts.gov) to arrange a date for areference to determine pursuantto CPLR 

### §43l7(b), and thatpursuantto CPLR 

### § 3215(b) the Clerk is directed to enterjudgment in favor ofplaintiffs and against defendant in accordance with the report ofthe aforementioned Special Referee without any further application. This constitutes the decision and order ofthe court.

08/20/2024 DATE SUZANNE ADAMS, J.S.C. CHECK ONE:
APPLICATION: CHECK IF APPROPRIATE: CASE DISPOSED GRANTED**□** DENIED SETTLE ORDER INCLUDES TRANSFER/REASSIGN NON-FINAL DISPOSITION GRANTED IN PART SUBMIT ORDER FIDUCIARY APPOINTMENT 651800/2021 STERLING LANDLORD CORP. ET AL vs. AXIS INSURANCE COMPANY Motion No. 002

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