Opinion
Index No. 656632/2020
08-02-2022
Harleysville Worcester Insurance Company, Plaintiff, v. Sompo America Insurance Company, SOMPO JAPAN INSURANCE COMPANY OF AMERICA, UNDERWRITERS AT LLOYD'S, LONDON (LLOYD'S LONDON), CERTAIN UNDERWRITERS AT LLOYD'S OF LONDON, Defendant.
Unpublished Opinion
ROBERT R. REED, J.S.C.
The following e-filed documents, listed by NYSCEF document number (Motion 002) 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 48, 49, 50 were read on this motion to CONSOLIDATE/JOIN FOR TRIAL
In motion sequence 002, plaintiff Harleysville Worcester Insurance Company (Harleysville), moves pursuant to CPLR 602 (a), for an order consolidating this action, Harleysville Worcester Insurance Company v Sompo America Insurance Company, Sompo Japan Insurance Company of America, Underwriters at Lloyd's, London (Lloyd's London), Certain Underwriters at Lloyd's of London (Index No.: 656632/2020) with another pending action, Hunt Construction Group, Inc. v Harleysville Worcester Insurance Company (Index No.: 652955/2017) ("the Hunt action").
Harleysville maintains that the actions which it seeks to consolidate arise out of the same personal injury action, Peter Kaps v The Port Authority of New York and New Jersey, Terminal One Management, Inc., and Hunt Construction Group, Inc. and Vanderlande Industries, Inc., (Sup Ct, Queens County, 702063/2014), which was commenced by Summons and Verified Complaint on March 27, 2014, and presently pending in the Supreme Court, Queens County.In the underlying action, Peter Kaps, the plaintiff in that action, alleges that he was caused to sustain personal injuries on May 9, 2013 while performing electrical work at JFK International Airport. Harleysville contends that, in that action, in which discovery is ongoing, Hunt Construction Group, Inc. (Hunt), the general contractor, commenced a third-party action against Peter Kaps' employer ASR Electrical Contracting, Inc., Corp. (ASR), an insured of Harleysville. ASR subsequently commenced a second third-party action against subcontractor Vanderlande Industries, Inc. (Vanderlande), and, thereafter, Peter Kaps amended the complaint to name Vanderlande as a direct defendant. Vanderlande commenced a third-party action against Oxford Airport Technical Services (Oxford).
Harleysville contends that the present action is a declaratory judgment action commenced by itself against Vanderlande's insurer, Sompo Japan Insurance Company (Sompo), and against Oxford's insurer, Lloyd's of London. Harleysville is seeking a declaration that this court determine and declare that Sompo's and Lloyd's of London are obligated to defend and indemnify Hunt, Terminal One Group Association, L.P., and the Port Authority of New York and New Jersey with respect to the underlying action on a primary basis as additional insureds and that any obligations otherwise owed by Harleysville are excess to those of Sompo and Lloyd's of London.
Harleysville argues that, in the Hunt action, Hunt is seeking a declaratory judgment declaring that Harleysville is obligated to defend and indemnify Hunt for damages, expenses and defense costs incurred while defending claims asserted in the underlying action. Harleysville maintains that Hunt is an additional insured under the Harleysville insurance policy procured by ASR for the period of February 1, 2013 through February 1, 2014, and that Harleysville is obligated to reimburse Hunt for all prior legal fees and expenses incurred by Hunt in defending against Kaps in the personal injury litigation.
Harleysville argues that maintaining separate actions poses a risk of inconsistent results, which may prejudice Harleysville if the cases are not consolidated. It argues that consolidating the two actions will determine all issues, including the requests for declaratory judgment on coverage owed and priority of coverage, and will reduce the cost and time of litigation. Harleysville contends that the two cases involve common questions of law and fact, that judicial economy favors consolidation of discovery, and that consolidation will not prejudice the parties. Harleysville argues that discovery is ongoing in the Hunt action and that the cost of discovery would not increase because plaintiffs in both actions have an interest in discovery with all defendants. Harleysville maintains that counsel for Sompo has not submitted opposition to this motion and that, on November 18, 2021, had agreed to sign a stipulation of consolidation to consolidate both actions.
In opposition, Lloyd's of London contends that the only common factor which the Harleysville action shares with the Hunt action is the underlying workplace injury lawsuit, which may or may not result in liability triggering an indemnity obligation on the part of one or both defendants in the Harleysville action. Lloyd's of London contends that the legal issues pertaining to insurance coverage that require resolution in the Harleysville action will entail analysis of different facts, contracts, and insurance policy provisions than those presented in the Hunt action. They argue that Oxford's policy is governed by Texas law, which honors limitations on coverage provided to additional insureds pursuant to contracts between an insured and the additional insured, even in the absence of any policy language explicitly limiting such coverage.
Lloyd's of London contends that, in the Hunt action, the legal issues requiring analysis and resolution will be defined primarily by the terms and conditions of the liability insurance policy which Harleysville issued to ASR and the subcontract between Hunt and ASR, and, therefore, it is unclear if any issues may overlap with the issues pertaining to coverage under the policy Sompo issued to Vanderlande. Lloyd's of London contends that it is unlikely that there is any overlap with the additional insured coverage issues raised by the Oxford policy and that Harleysville's contention that consolidation of the two actions would avoid duplication of discovery and conserve judicial resources is inaccurate.
CPLR 602 (a) provides:
"[w]hen actions involving a common question of law or fact are pending before a court, the court, upon motion, may order a joint trial of any or all the matters in issue, may order the actions consolidated, and may make such other orders concerning proceedings therein as may tend to avoid unnecessary costs or delay."
"CPLR 602 (a) gives the trial court discretion to consolidate actions involving common questions of law or fact" (Matter of Progressive Ins. Co. v Countrywide Ins. Co., 10 A.D.3d 518, 519 [1st Dept 2004]). "Although great deference is to be accorded to the motion court's discretion, it is well settled that there is a preference for consolidation in the interest of judicial economy where there are common questions of law and fact, unless the party opposing the motion demonstrates that consolidation will prejudice a substantial right" (Geneva Temps, Inc. v New World Communities, Inc., 24 A.D.3d 332, 334 [1st Dept 2005]; see also Lema v 1148 Corp., 176 A.D.3d 653, 654 [1st Dept 2019]).
Here, the affirmation by Harleysville and the opposition by Lloyd's of London demonstrate that both actions are related to Kaps' underlying accident. The relation of the cases is limited, however, to the triggering coverage event. The Hunt action and the Harleysville action involve separate contractual language, with different coverage provisions. The facts bearing on liability in the Hunt action are inapplicable and irrelevant to an assessment of liability in the Harleysville coverage action. The matters are not related for the purposes of interpreting contractual language assessing additional insured coverage and priority of coverage.
Furthermore, while Harleysville contends that consolidating the two actions would cause no prejudice to any party because discovery in the Hunt action "is ongoing" (NYSCEF DOC NO. 33, ¶ 27), upon reviewing the record, the complaint in the Hunt action was filed on June 1, 2017, and a preliminary conference was held on April 5, 2018, with a note of issue deadline of December 12, 2018. According to NYSCEF, the note of issue deadline was extended to November 25, 2021. It is unclear what discovery, if any, remains in the Hunt action, why the note of issue was not filed, and whether consolidation would further delay this case from proceeding. It also remains unclear how much discovery is needed in the Harleysville action and whether it will further delay the Hunt action as the complaint in the Harleysville action was filed on December 1, 2020, and a preliminary conference has yet to be held.
The Appellate Division, First Department, has held that "[e]ven where there are common questions of law or fact, consolidation is properly denied if the actions are at markedly different procedural stages and consolidation would result in undue delay in the resolution of either matter" (Abrams v Port Auth. Trans-Hudson Corp., 1 A.D.3d 118, 119 [1st Dept 2003]). As it has been five years since the complaint was filed in the Hunt action and over four years since the preliminary conference was held, that case should not be delayed any further.
Accordingly, it is
ORDERED that Harleysville Worcester Insurance Company's motion to consolidate this action with Hunt Construction Group, Inc. v Harleysville Worcester Insurance Company (Index No.: 652955/2017) is denied without prejudice; and it is further
ORDERED that a Preliminary Conference will be held on August 25, 2022 at 10:00 a.m.