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URS Corp. v. Zurich Am. Ins. Co.

Supreme Court of New York, New York County

January 16, 2014, Decided

653952/2012

Opinion

 [*392]  [**507]  Shirley Werner Kornreich, J.

In this insurance action, plaintiffs seek a declaratory judgment that the defendant insurers are obligated to indemnify and defend them against claims for personal injury arising out of a fire at plaintiffs' work site. Defendant Hudson Specialty Insurance Company (Hudson) moves to dismiss pursuant to CPLR 3211 (a) (1). Plaintiffs oppose. For the reasons that follow, the court grants the motion and dismisses Hudson from the case.

I. Background 

This is yet another action arising out of the tragic fire that occurred at 130 Liberty Street (formerly known as the Deutsche Bank building) on August 18, 2007, during which two firefighters lost their lives. The building, which had been severely damaged by the terrorist attack of September 11, 2001, had been conveyed in 2004 to the Lower Manhattan Development Corporation (LMDC) for purposes of redevelopment. LMDC hired plaintiffs URS Corporation and URS Corporation - New York (collectively, URS)  [***2] to provide "owner representative services" in connection with the building (amended complaint ¶ 16). LMDC then retained Bovis as general contractor for the project to "deconstruct" the building. Certain other companies also were retained to perform services in connection with the project, including Site Safety, LLC (Site Safety), Regional Scaffolding & Hoisting Co. (Regional Scaffolding), and The John Galt Company (John Galt). Each of these companies procured insurance policies to indemnify them against any claims or litigation costs arising out of their work on the project and, according to URS, named URS as an additional insured: Bovis from defendant Zurich American Insurance Company (Zurich), Site Safety from Zurich and defendant Steadfast Insurance Company (Steadfast), and Regional Scaffolding from defendant Liberty Surplus Insurance Corporation (Liberty). Finally and most relevant here, John Galt purchased contractors pollution liability coverage from defendant Hudson (see affirmation of Matthew J. Gaul, Aug. 7, 2013, exhibit 2 [the Hudson policy]).

 [*393]   Under the Hudson policy, the insurer was obligated to "pay on behalf of the insured those damages for bodily injury or property damage  [***3] . . . that the insured becomes legally obligated to pay . . . [i]f the damages result from a pollution condition at any site where any insured . . . is performing . . . any contracting or remediation operations," subject to certain conditions (Hudson policy, part I [A]). A "pollution condition" was defined as "the discharge, dispersal, release or escape of smoke, vapors, fumes, acids, alkalis, toxic [**508]  chemicals liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any watercourse or body of water which results in bodily injury or property damage" (Hudson policy, part II). Hudson had the "right and duty to provide for the defense of the insured with respect to a claim made against the insured" (id.). The contract explicitly noted that it did not provide commercial general liability (CGL) coverage (see Hudson policy, common policy declarations page & coverage part declarations).

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43 Misc. 3d 391 *; 979 N.Y.S.2d 506 **; 2014 N.Y. Misc. LEXIS 222 ***; 2014 NY Slip Op 24016 ****; 2014 WL 272457

 [****1]  URS Corporation et al., Plaintiffs, v Zurich American Insurance Company et al., Defendants. Zurich American Insurance Company et al., Third-Party Plaintiffs, v American Home Assurance Company et al., Third-Party Defendants.

Prior History: Estate of Robert C. Beddia, 2007 NY Misc LEXIS 7904 (2007)

CORE TERMS

pollution, coverage, insured, underlying action, dispersal, environmental, pollution exclusion, firefighters, atmosphere, complaints, smoke, Site

Civil Procedure, Responses, Defenses, Demurrers & Objections, Motions to Dismiss, Evidence, Types of Evidence, Documentary Evidence, General Overview, Pleadings, Complaints, Requirements for Complaint, Affidavits, Insurance Law, Policy Interpretation, Ambiguous Terms, Coverage Favored, Liability & Performance Standards, Good Faith & Fair Dealing, Duty to Defend, Indemnification, Construction Against Insurers, Reasonable Expectations, Environmental Law, Hazardous Wastes & Toxic Substances, Disposal, Storage & Treatment, Commercial General Liability Insurance, Exclusions, Pollution, Claim, Contract & Practice Issues, Technical Constructions & Meanings