New York State Court of Claims

New York State Court of Claims

Pro Motion v. THE STATE OF NEW YORK, #2000-015-037, Claim No. 99205, Motion Nos. M-61201, CM-61455


Summary judgment was granted to claimant upon the liability issue because a promisee seeking summary judgment based upon a promisor's failure to name the promisee as an additional insured, as required by the contract between the two, need only show that the contract so required and the promisor failed to comply with the provision.

Case Information

Claimant short name:
Pro Motion
Footnote (claimant name) :

Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
Motion number(s):
Cross-motion number(s):
Claimant's attorney:
Fogarty & Fogarty, P.C.By: Garrett Duffy, Esquire
Defendant's attorney:
Honorable Eliot Spitzer, Attorney General
By: Michael A. Zeytoonian, Esquire
Assistant Attorney General
Third-party defendant's attorney:

Signature date:
June 13, 2000
Saratoga Springs

Official citation:

Appellate results:

See also (multicaptioned case)


The motion of the claimant for an order pursuant to CPLR 3212 granting it partial summary judgment upon the liability issue is granted and the cross-motion of the defendant for an order granting it summary judgment dismissing the claim in its entirety is denied. The facts and issues involved in this claim are set forth in detail in the prior decision and order of this Court filed on January 27, 2000, which denied the claimant's motion for summary judgment and the defendant's cross-motion for an order dismissing the claim and will not be repeated at length here.

Briefly, on November 18, 1996, an agent of the New York State Lottery executed a contract whereby claimant was to provide promotional services on behalf of the Lottery. The contract took effect on October 21, 1996 and was extended through March 31, 1998. Pursuant to the contract, the Lottery provided a bus which was used by claimant's employees in the course of the promotional activities. Article 9 of the contract provides, in pertinent part, as follows:
9.2 Bus Insurance

The Lottery is responsible for providing $1,000,000 vehicle insurance for the bus and equipment. Coverage must also provide injury, death or property damage resulting from each occurrence.

9.3 Insurance Certificate

The Lottery will provide PMI with a certificate of insurance naming PMI as an additional insured under such policy.
On May 21, 1997, the bus was parked on the clubhouse apron of Yonkers Raceway in Yonkers, New York, when Lorraine Kelly, an employee of Yonkers Raceway, allegedly entered the bus in the course of her employment duties. Ms. Kelly fell upon departing the bus sustaining a fractured left ankle.

Ms. Kelly commenced an action in Bronx County Supreme Court against the claimant and two of its employees alleging that she entered the bus at the invitation and with the permission of the employees and that negligence in the manner in which the bus was parked and equipped caused her injuries. Claimant contends that it requested that the State defend and indemnify it in the Supreme Court action, which request was denied. During September and October of 1997, Ms. Kelly served and filed a claim in this Court against the State to recover for personal injuries again alleging that she entered the bus with the permission and at the invitation of agents of the Lottery. On October 26, 1998, claimant filed this claim seeking damages due to the defendant's breach of its contractual promise to secure a certificate of insurance naming the claimant as an additional insured. Claimant moved for summary judgment seeking a declaration of its rights and specific performance of the contractual provision and the defendant cross-moved to dismiss upon various grounds, including that the claim was barred because claimant failed to follow contractual procedures in requesting indemnification and defense. Claimant's motion was denied upon the ground that the Court lacked subject matter jurisdiction to grant the requested relief. However, the Court noted that the claim stated a viable cause of action for breach of contract in failing to name claimant as an insured upon a policy insuring the bus for $1,000,000.00. The defendant's cross-motion to dismiss was denied in the following language:
The second basis for the dismissal motion is that the claim is barred because the claimant failed to follow contractual procedures in requesting indemnification and a defense. The crux of that argument is that following the contract provisions as to how and to whom a request for indemnification and defense is made constitutes a condition precedent to a cause of action for breach of contract. CPLR 3015 (a) provides that the denial of the performance of a condition precedent in a contract must be pleaded with specificity and particularity as an affirmative defense in the answer. The State's answer does not contain such an affirmative defense resulting in a waiver of the defendant's arguments concerning claimant's alleged failure to properly institute the defense and indemnification request under the terms of the contract (125 Skillman Ave. Corp. v American Home Assur. Co., 103 Misc 2d 284).
By this motion, claimant seeks partial summary judgment determining that the defendant breached its contractual promise to make claimant an additional named insured. Defendant's cross-motion is premised upon the exact same basis as its prior dismissal motion which was denied in the above quoted language.

The cross-motion will be addressed first. Defense counsel states in paragraph 18 of his affirmation offered in support of the cross-motion for summary judgment that "The Court, in its previous Decision and Order, held that the Defendant's failure to include said affirmative defenses may have served to waive the Defendant's argument that claimant failed to comply with the applicable terms of the contract". Counsel has apparently misconstrued the language of the Court's previous decision and order which specifically held that the defendant had, in fact, waived the affirmative defense of claimant's failure to comply with contractual provisions relative to invoking indemnification and defense. The Third Department has held that when a defendant moves to dismiss a cause of action upon the very same ground that was raised and denied in a prior dismissal motion the Court should treat the second motion as one for reargument (Elm Shade Maintenance Corp. v Elm Shade Estates, 246 AD2d 872). Treating the defendant's cross-motion for summary judgment as a motion to reargue requires its denial as the defendant has not demonstrated that the Court misapprehended or overlooked relevant facts or misapplied any controlling principle of law in denying the prior cross-motion for the same relief.

Turning to claimant's motion for partial summary judgment, the defendant does not contest the fact that it did not secure a $1,000,000.00 policy of liability insurance which designated the claimant as an additional named insured. Instead, defendant argues that it did have a $1,000,000.00 insurance policy covering the bus with the Travelers Insurance Company which, while it did not name claimant as an additional named insured, covered claimant and its employees as permissive users of the bus. Defense counsel contends that since the language of the Travelers policy clearly extends coverage to claimant the State has met its contractual obligation to make claimant an additional named insured under a $1,000,000.00 liability policy of insurance covering the bus. The Court disagrees.

First, claimant's counsel states in his reply affirmation that "I have recently been advised by Travelers that they disclaimed coverage as the State never timely advised them of the accident". Thus, practically, it appears that there is no coverage under the Travelers policy. More importantly, the claimant did not contract with the Lottery for the hope of being found to be a permissive user of the bus under an existing policy of liability insurance. Instead, claimant specifically contracted to be an additional named insured. Claimant is not an additional named insured under the Travelers policy and defendant's breach of its contractual promise is clear.

It "is well established that the agreement to purchase insurance coverage is clearly distinct from and treated differently from the agreement to indemnify" (McGill v Polytechnic Univ., 235 AD2d 400, 401, 402). The law applicable upon a summary judgment motion contending that the defendant breached a promise to make the claimant an additional named insured upon a liability insurance policy is set forth in the case of Keelan v Sivan, 234 AD2d 516, 517, as follows:
A promisee seeking summary judgment based upon a promisor's failure to name the promisee as an additional insured, as required by the contract between the two, need only show that the contract so required and that the promisor failed to comply with this provision (see, Kinney v Lisk Co., 76 NY2d 215; DiMuro v Town of Babylon, 210 AD2d 373; Schumacher v Lutheran Community Servs., 177 AD2d 568). If such a showing is made, the promisor is liable to the promisee for the resulting damages for the promisor's failure to obtain the required insurance coverage, including the liability of the promisee to the plaintiff (see, Kinney v Lisk Co., supra; Schumacher v Lutheran Community Servs., supra), and the costs incurred in defending against the plaintiff's action.
Upon this record, claimant has made its required showing that the contract required the defendant to name it as an additional insured upon a liability insurance contract which the defendant failed to do. Defendant has not come forward with proof that it named claimant as an additional named insured on a liability policy (Schumann v City of New York, 242 AD2d 616, 617). Such circumstances entitle claimant to partial summary judgment as a matter of law upon the liability issue (Williams v Brunot, 240 AD2d 564), as the failure to grant such relief would be reversible error (Murray v Curtis Co., 189 AD2d 980, 981). Especially so, when the breach of the insurance procurement clause is an issue entirely separate and independent of other provisions of the contract concerning indemnification (Mathew v Crow Constr. Co., 220 AD2d 490).

Applying the foregoing principles of law to the facts contained in this motion record requires the granting of claimant's motion for partial summary judgment. There is no dispute that the Lottery contracted with claimant to make it an additional named insured upon a $1,000,000.00 policy of liability insurance covering the bus. The record is totally devoid of any evidence that the defendant met this contractual obligation and, therefore, controlling appellate authority warrants a ruling in claimant's favor upon the liability issue. Trial of the damages issue will be scheduled once the total defense costs and damages award in Ms. Kelly's Supreme Court action against claimant, if any, are ascertained.

June 13, 2000
Saratoga Springs, New York

Judge of the Court of Claims

The Court considered the following papers:
  1. Notice of motion dated February 7, 2000;
  2. Affirmation of Garrett Duffy dated February 7, 2000, with exhibits;
  3. Notice of cross motion dated March 28, 2000;
  4. Affirmation of Michael A. Zeytoonian dated March 22, 2000, with exhibits;
  5. Affidavit of Paul Mulson sworn to March 13, 2000;
  6. Reply affirmation of Garrett Duffy dated April 17, 2000.