The court granted partial summary judgment on the duty to defend to two additional insureds who were named as defendants in the underlying personal injury suit. In re Third St. Equity, LLC, 2025 U.S. Dist. LEXIS 234909 (E.D. N. Y. Dec. 2, 2025).

Third Street Equity LLD hired Developing NY State, LLC as the contractor for a construction project. Developing NY entered a subcontract agreement with Capital Source Concrete NY LLC for concrete work as well as labor and services for a construction project. The subcontract required that Capital Concrete keep the construction site free of debris, waste material or rubbish. Further, Capital Concrete was responsible for compliance with OSHA safety regulations. It was also agreed that Capital Concrete would obtain liability and workers compensation insurance naming Third Street and Developing NY as additional insureds.

Capital Concrete obtained a policy from Accredited Surety and Casualty Company, Inc. naming Third Street and Developing NY as additional insureds. The policy covered liability caused in whole or in part by acts or omissions by Capital Concrete or those acting on its behalf.

Tunin Romero was employed as a laborer by Capital Concrete. Romero allegedly tripped and fell while working at the project, causing injury. He sued Third Street and Developing NY for negligence, alleging that “he was caused to trip and fall as a result of defendants failure to keep the subject worksite clear from scattered tools, materials and debris.”

Third Street and Developing NY filed a third-party complaint against Capital Concrete, Romero’s employer, in the Romero Lawsuit, seeking common law and contractual indemnification and contribution and damages for breach of contract to procure insurance.

Third Street and Developing NY tendered the Romero Lawsuit to Accredited Surety as additional insureds under Capital Concrete’s policy. The tender was denied on the basis that there were no facts showing that Capital Concrete caused the injury.

Third Street and Developing NY sued Accredited Surety for declaratory relief that they were owed a defense and indemnification, and for defense costs incurred to date. Cross motions for summary judgment were filed.

Accredited Surety argued it had no defense or indemnity obligations to Third Street and Developing NY because there were no allegations of that liability was caused “in whole or in part by” Capital Concrete. The court found, however, that the underlying Romero Lawsuit specifically alleged that Romero was caused to trip and fall as a result of defendants’ failures to keep the worksite clear from scattered tools, materials and debris. Further, Third Street and Developing NY’s third-party complaint asserted that Capital Concrete exercised control over and performed work and services at the site where Romero was injured. They alleged that Romero’s injuries arose out of Capital Concrete’s performance under the subcontract and was caused solely by Capital Concrete’s actions or omissions.

Accredited Surety argued that the Romero Lawsuit did not raise a reasonable possibility of coverage because Romero did not allege that Capital Concrete caused the injury. New York law, however, statutorily prohibited Romero from naming his employer, Capital Concrete, as a negligent party liable for his injuries and this was not a basis to narrow the insurer’s duty to defend.

Further, the subcontract obligated Capital Concrete to keep the work stie clear of debris and provide safety materials to its employees. The third-party complaint alleged that Capital Concrete “exercised control over” the place of the alleged incident. Capital Concrete’s actions or omissions of its obligations under the subcontract allegedly caused Romero’s fall because it was Capital Concrete’s obligation to keep the property clear of materials and debris and to provide safety gear. Third Street and Developing NY were therefore entitled to a defense as additional insureds.

Third Street and Developing NY’s motion seeking indemnity was premature and had to await the determination of the named insured’s liability in the underlying action.

Finally, because a defense was owed, Accredited Surety was obligated to reimburse Third Street and Developing NY for the reasonable post-tender fees and costs incurred in the defense of the Romero Lawsuit, plus statutory pre-judgment interest.