The opinion
Scottsdale Ins. Co. v Sisco Architectural Metals Co.
2025 NY Slip Op 30450(U)
February 4, 2025
Supreme Court, New York County
Docket Number: Index No. 153564/2022
Judge: Richard G. Latin
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.
FILED: NEW YORK COUNTY CLERK 02/05/2025 04:47 PM INDEX NO. 153564/2022
NYSCEF DOC. NO. 88 RECEIVED NYSCEF: 02/05/2025
SUPREME COURT OF THE STATE OF NEW YORK
NEW YORK COUNTY
PRESENT: HON. RICHARD G. LATIN PART 46M
Justice
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SCOTTSDALE INSURANCE COMPANY,
MOTION DATE 09/05/2023
Plaintiff,
MOTION SEQ. NO. 001
-v-
SISCO ARCHITECTURAL METALS CO., EMMANUELLE
CASTILLO, SHANNON CONTRACTING LLC,MP 14 DECISION + ORDER ON
STREET PROPERTY LLC MOTION
Defendant.
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The following e-filed documents, listed by NYSCEF document number (Motion 001) 18, 19, 20, 21, 22,
23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50,
51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 64, 65, 66, 67, 68, 69, 70, 71, 72, 73, 74, 75, 76, 77, 78,
79, 80, 81, 82, 83, 84, 85, 86
were read on this motion to/for JUDGMENT - DEFAULT .
Upon the foregoing documents, and for the reasons spread across the record at oral
argument, plaintiff’s motion for summary judgment and default judgment, and defendants
Shannon Contracting LLC and MP 14 Street Property LLC’s cross-motion for summary judgment,
are determined as follows:
This declaratory judgement action arises from a comprehensive general liability policy (the
“Policy”) issued by plaintiff Scottsdale Insurance Company (“Scottsdale”) to defendant Sisco
Architectural Metals Co. (“Sisco”). Plaintiff moves for summary judgment declaring that it is not
required to defend and/or indemnify defendants, Sisco, MP 14th Street Property LLC (“MP 14”),
or Shannon Contracting, LLC (“Shannon Contracting”) (collectively, “Defendants”) in connection
with an underlying labor law action (the “Underlying Action”). Additionally, Plaintiff moves for
a default judgment against Sisco, pursuant to CPLR 3215, for its failure to appear.
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Motion No. 001
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In response, MP 14 and Shannon Contracting (the “Moving Defendants”) cross-move for
summary judgment, seeking a declaration that Scottsdale is obligated to defend and indemnify
Sisco, as the named insured, and MP 14 and Shannon Contracting, as additional insureds, in the
Underlying Action. The Moving Defendants also argue that the default judgment against Sisco
must be denied because the plaintiff failed to move for the default within one year.
I. Summary Judgment Motion
“ʻ[T]he proponent of a summary judgment motion must make prima facie showing of
entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the
absence of any material issues of fact’” (Ayotte v Gervasio, 81 NY2d 1062, 1063 [1993], quoting
Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). “[F]ailure to make such a showing requires
a denial of the motion, regardless of the sufficiency of the opposing papers” (Ayotte, 81 NY2d at
1063 [internal quotation marks and citation omitted]). “Once this showing has been made,
however, the burden shifts to the party opposing the motion for summary judgment to produce
evidentiary proof in admissible form sufficient to establish the existence of material issues of act
which require a trial of the action” (Alvarez, 68 NY2d at 324; see also Zuckerman v City of New
York, 49 NY2d 557, 562 [1980]). “[M]ere conclusions, expressions of hope or unsubstantiated
allegations or assertions are insufficient” (Zuckerman, 49 NY2d at 562).
“Summary judgment should not be granted where there is any doubt as to the existence of
a factual issue or where the existence of a factual issue is arguable” (Forrest v Jewish Guild for
the Blind, 3 NY3d 295, 315 [2004]; see also American Home Assur. Co. v Amerford Intl. Corp.,
200 AD2d 472, 473 [1st Dept 1994]). On a summary judgment motion, “facts must be viewed in
the light most favorable to the non-moving party” (Vega v Restani Constr. Corp., 18 NY3d 499,
503 [2012] [internal quotation marks and citation omitted]).
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“An insurance policy is a contract between the insurer and the insured. Thus, the extent of
coverage…is controlled by the relevant policy terms…” (Bond Lend Lease LMB, Inc. v Great Am.
Ins. Co., 53 AD3d 140, 145 [1st Dept 2008]).
A. MP 14
Plaintiff asserts that MP 14 is not entitled to additional insured coverage for the Underlying
Action because there is no written contract or agreement between MP 14 and Sisco naming MP 14
as an additional insured, which is required by the Policy. In opposition, MP 14 asserts that it is
entitled to additional insured status on the basis of a contract between Shannon Contracting and
Sisco, which required that Sisco name Shannon Contracting and MP 14 as additional insureds.
The plain language of the Policy expressly provides that there must be a written agreement
between the named insured and the organization seeking additional insured status.1 “Where [an]
insurance policy specifically provides that there must be a written agreement between the insured
and the organization seeking coverage to add that organization as an additional insured, and no
such agreement exists, such organization is not entitled to coverage as an additional insured”
(Structure Tone, Inc. v Nat. Cas. Co., 2014 N.Y. Slip Op. 30484[U] [N.Y. Sup Ct, New York
County 2014], affd 130 AD3d 405, 406 [1st Dept 2015]). It is undisputed that there is no written
agreement between Sisco and MP 14 naming MP 14 as an additional insured under the Policy. As
such, MP 14 is not entitled to coverage under the Policy because it does not qualify as an additional
insured (see AB Green Gansevoort, LLC v Peter Scalamandre & Sons, Inc., 102 AD3d 425, 426
[1st Dept 2013]; City of New York v Nova Cas. Co., 104 AD3d 410 [1st Dept 2013]).
1
The Policy states that an additional insured includes “any person or organization for whom you are performing
operations 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” (see NYSCEF Doc. No. 27).
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B. Shannon Contracting
As to Shannon Contracting, Scottsdale asserts that coverage is barred by the Absolute
Employee and Worker Injury and Liability Exclusion (the “Absolute Employee Exclusion”),
which excludes coverage for bodily injuries to an employee of any insured. Shannon Contracting
does not dispute that the Absolute Employee Exclusion applies but instead argues that Scottsdale’s
disclaimer on the basis of the exclusion was untimely and, as such, is waived a matter of law.
Insurance Law § 3420 (d) requires an insurer to give written notice of a disclaimer “as soon
as is reasonably possible” after the insurer learns of the grounds for disclaiming liability (Tully
Const. Co., Inc. v TIG Ins. Co., 43 AD3d 1150, 1152 [2d Dept 2007]). “[T]imeliness of an
insurer’s disclaimer is measured from the point in time when the insurer first learns of the grounds
for disclaimer of liability or denial of coverage” (First Fin. Ins. Co. v Jetco Contr. Corp., 1 NY3d
64, 68 [2003]). “[A]n insurer’s explanation is insufficient as a matter of law where the basis for
denying coverage was or should have been readily apparent before the onset of the delay” (id.).
However, a delay may be excused where the insurer conducts an “investigation into issues
affecting an insurer’s decision whether to disclaim coverage” (id.).
Here, Shannon Contracting tendered the claim for the Underlying Action on September 24,
2020. Plaintiff disclaimed coverage on the basis of the Absolute Employee Exclusion on
November 25, 2020 (see NYSCEF Doc. No. 39).
Shannon Contracting argues that there is no reasonable excuse for this delay because the
basis of the disclaimer is “obvious” from the face of the tender. This court disagrees. Though the
tender stated that Sisco was the employer of the plaintiff in the Underlying Action, the complaint
in the Underlying Action did not identify Sisco as the employer. Moreover, plaintiff contacted
Sisco on October 6, 2020, a week after receiving the tender, and Sisco’s principle stated that the
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plaintiff in the Underlying Action was not his employee. Additionally, the Worker’s
Compensation Board decision, dated October 16, 2020, noted that Sisco disputed the employee
status of the plaintiff in the Underlying Action. Then, on November 2, 2020, MP 14 filed a third-
party complaint in the Underlying Action, asserting that Sisco was the employer. Given this
inconsistent information regarding the plaintiff’s employer in the Underlying Action, the two-
month delay in disclaiming coverage on the Absolute Employee Exclusion is reasonable and
timely (see Stabules v Aetna Life & Cas. Co., 226 AD2d 138, 139 [1st Dept 1996] [finding a two-
month delay reasonable where insurer was required to conduct an investigation into the claim];
see also Tully Const. Co., Inc. v TIG Ins. Co., 43 AD3d 1150, 1153 [2d Dept 2007]; cf. First Fin.
Ins. Co. v Jetco Contr. Corp., 1 NY3d 64, 69 [2003] [finding 48-day delay unreasonable where
insurer investigated alternative sources of insurance that were not related the decision to deny
coverage]).
II. Default Judgment against Sisco
When a party fails to appear or answer, its adversary may seek a default judgment from
that party (CPLR 3215 [a]). CPLR 3215(c) requires a motion for default judgment be made within
one year of the default. An untimely motion must be denied, and the complaint dismissed as
abandoned, unless plaintiff provides “sufficient cause” as to why the complaint should not be
dismissed (CPLR 3215 [c]).
Here, the complaint was filed on April 26, 2022, service was effectuated on Sisco on or
about May 5, 2022, and Sisco was required to appear by June 5, 2022. Plaintiff filed the instant
motion on September 5, 2023, fifteen months after the default. Though plaintiff did not move for
a default within one year of Sisco’s default, the record shows that plaintiff did not abandon the
action (see White Oak Commercial Fin., LLC v Goyal, 63 Misc 3d 1208(A) [Sup Ct 2019]; see
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also Laourdakis v Torres, 98 AD3d 892 [1st Dept 2012]). Plaintiff filed an RJI, contacted Sisco
regarding the default, and engaged in discovery with the appearing defendants. Defendants have
also made no showing of any prejudice from the mere three month delay (see LaValle v Astoria
Const. & Paving Corp., 266 AD2d 28, 28 [1st Dept 1999]).
Accordingly, it is hereby
ORDERED that plaintiff’s motion for summary judgment and default judgment are
granted; and it is further
ORDERED, ADJUDGED, and DECLARED that plaintiff Scottsdale has no obligation to
defend or indemnify defendants Sisco, MP 14th Street, or Shannon Contracting; and it is further
ORDERED that the moving defendants’ cross-motion is denied in all respects.
This constitutes the decision and judgment of the Court.
2/4/2025 $SIG$
DATE RICHARD G. LATIN, J.S.C.
CHECK ONE: X CASE DISPOSED NON-FINAL DISPOSITION
□
X GRANTED DENIED GRANTED IN PART OTHER
APPLICATION: SETTLE ORDER SUBMIT ORDER
□
CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT REFERENCE
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