Opinion ID: 791124
Heading Depth: 2
Heading Rank: 2

Heading: Defendants' Appeal: Contractual Indemnification

Text: 28 The defendants argue that the district court erred in concluding that the Lease's indemnity provision is unambiguous and in granting summary judgment to Allianz on its claim for contractual indemnification in the amount of $340,000. 29 Whether a contract is clear or ambiguous is a question of law. Kass v. Kass, 91 N.Y.2d 554, 566, 673 N.Y.S.2d 350, 696 N.E.2d 174 (1998). Ambiguity is determined by looking within the four corners of the document, not to outside sources. Id. An ambiguous term is one that is reasonably susceptible to more than one reading, or one as to which reasonable minds could differ. See Van Wagner Adver. Corp. v. S & M Enters., 67 N.Y.2d 186, 191, 501 N.Y.S.2d 628, 492 N.E.2d 756 (1986). A contractual ambiguity generally renders summary judgment inappropriate in a breach of contract action. See Compagnie Financiere de CIC et de l'Union Europeenne v. Merrill Lynch, Pierce, Fenner & Smith Inc., 232 F.3d 153, 158 (2d Cir.2000) (observing that a `court may resolve ambiguity in contractual language as a matter of law if the evidence presented about the parties' intended meaning [is] so one-sided that no reasonable person could decide the contrary' (quoting 3Com Corp. v. Banco do Brasil, S.A., 171 F.3d 739, 746-47 (2d Cir.1999)) (alteration in original)). 30 The indemnity provision in the Lease provides that if MBCC is  subjected to any claims, losses, injuries, expenses, or costs related to the use, maintenance or condition of the vehicle, Lerner will pay all of [MBCC's] resulting costs and expenses, including attorneys' fees (emphasis added). 31 In opposition to Allianz's summary judgment motion below, the defendants argued that the Lease was ambiguous as to whether their indemnity obligation applied only to the mandatory amount of insurance coverage ($100,000) or to excess claims not covered by insurance. The district court flatly rejected the defendants' sole argument—which, incidentally, they have abandoned on appeal. Allianz I, 296 F.Supp.2d at 423. 32 Now, for the first time, defendants argue that two additional ambiguities in the Lease preclude the award of summary judgment to Allianz. First, they highlight the term  subjected to  and ask whether MBCC was indeed subjected to liability by voluntarily settling the State Court Action as distinct from being found liable by a judge or jury. Second, they argue that the extent of indemnification was ambiguous because the Lease required the defendants to indemnify MBCC for its resulting costs and expenses, not the allegedly greater value of all of its claims, losses, injuries, [and] expenses. 33 Before we can address these arguments, the defendants must overcome a procedural hurdle. [I]t is a well-established general rule that an appellate court will not consider an issue raised for the first time on appeal. Greene v. United States, 13 F.3d 577, 586 (2d Cir.1994). Nevertheless, because this rule is prudential, not jurisdictional, we have discretion to consider waived arguments. Sniado v. Bank Austria AG, 378 F.3d 210, 213 (2d Cir.2004) (per curiam). We have exercised this discretion where necessary to avoid a manifest injustice or where the argument presents a question of law and there is no need for additional fact-finding. Id. 34 The circumstances here do not militate in favor of an exercise of discretion to address the new arguments on appeal. Because both arguments are based on the terms of the Lease, they were both available to the defendants below. See id. (availability of argument below weighs against exercising discretion to hear the belated argument on appeal). Defendants proffer no reason for their failure to raise the arguments below, nor do they suggest that there will be any great injustice if we refuse to address them. In these circumstances, we decline the invitation to address the untimely arguments. See Greene, 13 F.3d at 586 (Entertaining issues raised for the first time on appeal is discretionary with the panel hearing the appeal.). 35 Thus, we affirm the district court's ruling that the defendants are required to indemnify Allianz. 36