Why One Queens Building Owner Deserved To Lose His Breach of Contract & Indemnity Claim April 19, 2010

Sometimes when reading a court’s decision, there are facts from the case that almost jump off the page and make you wonder: if what the court is saying is true, why on earth did they even bother filing the lawsuit to begin with? Why not just accept that you messed up and move on?

In Bailey v. Beechwood Arverne LLC, the plaintiff was injured when he was hit by a moving excavator machine while working for the general contractor at a construction site that was owned by the defendant. In response to the plaintiff’s personal injury lawsuit, the defendant owner in turn sued the general contractor, seeking to hold the GC liable not only in contractual and common law indemnification (i.e., “holding the owner harmless”), but in breach of contract based upon the GC’s failure to obtain the required insurance, and for the GC’s pro-rata share of the liability in the underlying personal injury lawsuit (a/k/a “contribution”).

So far, so good, right? Well, it turns out that there was one little, “minor” problem.

Although the owner assumed that the general contractor was obligated to procure insurance in the owner’s favor and to have the owner named as an additional insured on the GC’s policy (as is usually the case), the owner never bothered to make sure that the contract had this provision.

So what did the owner do instead? They tried to pull the wool over everyone’s eyes by trying to pass off another contract they had with the GC that related to completely different work, and which was dated after the accident as proof of the GC’s purported obligation to obtain insurance in the owner’s favor.

In my view, this conduct is not just shameful; since it – in bad faith – wasted the court’s time and resources, as well as that of the GC, this conduct should be deemed sanctionable. It is frivolous.

Jonathan Cooper is a New York Business Litigation and New York Commercial Litigation Lawyer with a focus on New York breach of contract and New York business fraud claims before the Nassau, Queens, Brooklyn, Bronx, Westchester and Suffolk County courts of New York State. For more information, feel free to contact his Long Island office at 516-791-5700.

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