Case Name: Admiral Insurance Company et al., Appellants, v. Marriott International, Inc., et al., Respondents, et al., Defendants
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 2010-12-16
Citations: 79 A.D.3d 572
Docket Number: 
Parties: Admiral Insurance Company et al., Appellants, v Marriott International, Inc., et al., Respondents, et al., Defendants.
Judges: 
Reporter: Appellate Division Reports
Volume: 79
Pages: 572–577

Head Matter:
Admiral Insurance Company et al., Appellants, v Marriott International, Inc., et al., Respondents, et al., Defendants.
[915 NYS2d 31]

Opinion:
Order, Supreme Court, New York County (Louis B. York, J.), entered April 2, 2009, which granted defendant Eagle One's motion to vacate a default judgment, reversed, on the law, without costs, the motion denied and the default reinstated. Order, same court and Justice, entered August 19, 2009, which, inter alia, granted the Marriott defendants' motion for summary judgment dismissing the complaint as against them, modified, on the law, to vacate the dismissal and to declare that the Marriott defendants are not obligated to defend and indemnify plaintiff Townhouse Management Co. in connection with the underlying personal injury action, and otherwise affirmed, without costs.
Eagle One's motion to vacate the default judgment should have been denied because the only excuse it proffered for its default was a perfunctory and unsubstantiated claim of law office failure, which does not constitute a reasonable excuse (see Okun v Tanners, 11 NY3d 762 [2008]; AWL Indus., Inc. v QBE Ins. Corp., 65 AD3d 904, 906 [2009]). Accordingly, consideration of the merits of Eagle One's defense is unnecessary (see Time Warner City Cable v Tri State Auto, 5 AD3d 153, 153 [2004], appeal dismissed 3 NY3d 656 [2004]). Eagle One's contention, raised for the first time on appeal, that the motion to enter judgment on default was untimely because it was made more than one year after the default is not entitled to consideration (see Cohn v Goldman, 76 NY 284, 287 [1879]; Recovery Consultants v Shih-Hsieh, 141 AD2d 272, 276 [1988] [a party is prohibited from arguing on appeal a theory not advanced before the court of original instance]) and, in any event, is devoid of merit. Eagle One erroneously measures the default from the date of service of the summons and complaint rather than from the date on which its answer was due (see PM-OK Assoc. v Britz, 256 AD2d 151, 152 [1998]).
Subject to one qualification, Supreme Court correctly concluded that Marriott's obligations to indemnify and procure insurance coverage were contingent on the lease commencement date and substantial completion of the construction work on the building it was to occupy pursuant to its master lease agreement (MLA). That construction of the MLA is supported by its plain language, and a contrary interpretation would not be commercially reasonable (see Matter of Lipper Holdings v Trident Holdings, 1 AD3d 170, 171 [2003]), insofar as it would require the party without any control over the construction work to indemnify the party exercising plenary authority over that work. To be sure, the last sentence of section 2.6 of the MLA provides that Marriott's duty to indemnify under section 12.1 is triggered by "[a]ny entry onto the Property prior to the Lease Commencement Date by [Marriott], its employees, inspectors, contractors or agents." But this exception proves the rule as the last sentence of section 2.6 would be surplusage if plaintiffs were correct that Marriott assumed the indemnification obligations as soon as the MLA became binding (see Beal Sav. Bank v Sommer, 8 NY3d 318, 324 [2007]). Plaintiffs' fallback argument — that issues of fact exist as to the effectiveness of the lease — is without merit. As Supreme Court found, plaintiffs raise no issue of material fact that substantial completion had not occurred at the time of the underlying accident.
Contrary to the concurrence's apparent view, plaintiffs do not argue that Marriott's obligation to indemnify under the MLA arises in the first instance under the last sentence of section 2.6. Notably, moreover, plaintiffs allege in their complaint that they are entitled to be indemnified under the MLA because of the provisions of section 12.1. To the extent that plaintiffs are contending nonetheless that Marriott is required to indemnify them because of the last sentence of section 2.6, we reject it for the simple reason that any such argument is raised for the first time in plaintiffs' reply brief. Pursuant to the last sentence of section 12.1, Marriott is not obligated to indemnify (regardless of whether the duty to indemnify assertedly arises in the first instance under section 12.1 or the last sentence of section 2.6) with respect to a claim arising out of negligent acts (and certain omissions) of the landlord or its agents, employees or contractors. Thus, such an argument does not raise a pure issue of law that can be raised on appeal for the first time (see Vanship Holdings Ltd. v Energy Infrastructure Acquisition Corp., 65 AD3d 405, 408 [2009]).
The concurrence's position with respect to that argument is premised on a cross motion made by Marriott and the failure of plaintiffs to contest a factual assertion made by Marriott in the cross motion. The cross motion, however, was made by plaintiffs, not Marriott. Moreover, Marriott does not argue in its brief that plaintiffs should be deemed to have conceded that the accident resulted from the landlord's negligence (see Misicki v Caradonna, 12 NY3d 511, 519 [2009] ["to decide this appeal on a distinct ground that we winkled out wholly on our own would pose an obvious problem of fair play"]).
We modify to make the declaration that the motion court intended but neglected to make (see Lanza v Wagner, 11 NY2d 317, 334 [1962], appeal dismissed 371 US 74 [1962], cert denied 371 US 901 [1962]). Concur — Sweeny, Catterson and McGuire, JJ.