SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ----------------------------------------x Index No.: 221 WEST 17 TH STREET, LLC, -against- Plaintiff, COMPLAINT ALLIED WORLD SURPLUS LINES INSURANCE COMPANY, Defendant. ----------------------------------------x Plaintiff, by its attorneys, WILKOFSKY, FRIEDMAN, KAREL and CUMMINS, as and for its Complaint, herein alleges the following upon information and belief: FIRST: At all times hereinafter mentioned, Plaintiff was and is a limited liability company duly organized and existing under and by virtue of the laws of the State of New York. SECOND: Upon information and belief, Defendant ALLIED WORLD SURPLUS LINES INSURANCE COMPANY (hereinafter ALLIED ) was and is a corporation duly organized and existing under and by virtue of the laws of the State of Arkansas. The Facts THIRD: Heretofore and on or about April 6, 2015, ALLIED (previously Darwin Select Insurance Company), made and issued its certain policy of insurance bearing policy number 0309-4846. 1 1 of 7
FOURTH: The aforementioned policy of insurance did provide insurance to Plaintiff for the location 221-225 West 17 th Street, New York, NY 10011" (hereinafter The Property ), for, inter alia, Builder s Risk, Delay in Completion, Rehabilitation and Renovation, Debris Removal, You Must Protect Property (expenses incurred to protect The Property), all for the period April 6, 2015 through April 6, 2016, all as per the Policy s terms and provisions. FIFTH: On or about October 20, 2015, a fire loss occurred at The Property upon which rehabilitation and renovation had started. SIXTH: At all relevant times, the aforementioned policy was in full force and effect. SEVENTH: As a result of the foregoing, Plaintiff suffered loss, inter alia, to The Property including, but not limited to, physical damage, delay in completion, rehabilitation and renovation expenses, fees and costs, debris removal costs and expenses, emergency expenses, expediting and general administration expenses, and expenses incurred to protect The Property from further damage. EIGHTH: Plaintiff has submitted claims and made due demand upon ALLIED pursuant to the policy. 2 2 of 7
AS AND FOR PLAINTIFF S FIRST CAUSE OF ACTION NINTH: Plaintiff repeats reiterates and realleges the contents of each of the prior paragraphs as if fully and completely set forth herein. TENTH: Plaintiff has suffered loss in at least the sum of Three Million Two Hundred Thousand Dollars ($3,200,000) due to delays in completion. ELEVENTH: Defendant has made payment for Plaintiff s Delay in Completion claim. TWELFTH: Plaintiff has suffered loss in excess of the sum of Six Hundred Ninety Five Thousand Seven Hundred Fifty Dollars ($695,750) for the cost of debris removal. THIRTEENTH: Defendant has made payment in the sum of Six Hundred Ninety Five Thousand Seven Hundred Fifty ($695,750) Dollars towards Plaintiff s debris removal costs and expenses. FOURTEENTH: The policy s limit on the entitlement to recover for debris removal expenses is a percentage of the premises Actual Cash Value. FIFTEENTH: Plaintiff expects that the Actual Cash Value will be found to be in excess of the Actual Cash Value figure ascribed by Defendant. SIXTEENTH: Plaintiff is entitled to the recover for increased debris removal expenses incurred as limited by the policy. 3 of 7 3
SEVENTEENTH: Plaintiff makes claim for the additional debris removal expenses. EIGHTEENTH: Plaintiff re-allocated Nine Hundred Seventy-Seven Thousand Thirty-One Dollars ($977,031 towards Plaintiff s incurred emergency expenses of funds which Defendant is believed to have attributed towards the Delay in Completion claim. NINETEENTH: Plaintiff has suffered loss and incurred expenses to protect The Property from further damage in at least the sum of Eight Million Three Hundred Eighty-Three Thousand Four Hundred and Eight Dollars($8,383,408). TWENTIETH: Defendant has not made any payments towards Plaintiff s expenses incurred to protect The Property from further damage. TWENTY-FIRST: Plaintiff has suffered loss and damage to The Property of at least Seven Million Nine Hundred Twenty- Five Thousand Nine Hundred Five Dollars and 75/100 ($7,925,905.75). TWENTY-SECOND: Defendant has made payment of Two Million Five Hundred Eighty-Three Thousand Dollars($2,583,000) upon Plaintiff s claim for damage to The Property. TWENTY-THIRD: Defendant owes the difference of the amount claimed and the amount paid for damages to The Property, being the sum of at least Five Million Three Hundred Forty-Two Thousand Nine Hundred Five Dollars and 75/100($5,342,905.75) unpaid. 4 of 7 4
TWENTY-FOURTH: Defendant asserted its position that one of its experts had ascertained a replacement value of the premises to be Five Million One Hundred Sixty-Six Thousand Dollars ($5,166,000) immediately prior to the fire, to which a Fifty Percent (50%) depreciation figure was applied, resulting in an alleged Actual Cash Value of the premises of Two Million Five Hundred Eighty-Three Thousand Dollars($2,583,000). TWENTY-FIFTH: Plaintiff is and was entitled to payment from ALLIED for all of the aforementioned items of loss and damage. TWENTY-SIXTH: ALLIED was apprised that its failure to pay would result in Plaintiff suffering significant other damages, costs fees and expenses. TWENTY-SEVENTH: ALLIED refusal to pay, combined with its failure to pay portions of Plaintiff s claims have resulted in Plaintiff suffering significant additional costs, fees and expenses. TWENTY-EIGHTH: By letter of May 12, 2017 ALLIED was advised that if it failed to remit payment to Plaintiff that Plaintiff would necessarily need to seek additional financing for the project and that the projected additional costs as of that day would be the sum of One Million Six Hundred Sixty-Eight Thousand Three Hundred Twenty-Three Dollars and 80/100 ($1,668,323.80). 5 5 of 7
TWENTY-NINTH: ALLIED was and is aware that Plaintiff was entitled to recover for significant portions of Plaintiff s claims for which Defendant has yet to have made payment. THIRTIETH: ALLIED s failure to pay and its denial of liability to Plaintiff on portions of Plaintiff s claims were done in bad faith. THIRTY-FIRST: ALLIED s failure to pay and its denial of liability as to aspects of Plaintiff s claims were without merit and constitute a breach of contract. THIRTY-SECOND: The above issues remain unresolved, and Plaintiff has not been paid on the balance of its claims. THIRTY-THIRD: As a result of the foregoing, Plaintiff has sustained losses and damage in at least the sum of Thirteen Million Seven Hundred Twenty-Six Thousand Three Hundred Thirteen Dollars and 75/100($13,726,313.75). AS AND FOR PLAINTIFF S SECOND CAUSE OF ACTION THIRTY-FOURTH: Plaintiff repeats reiterates and realleges the contents of each of the prior paragraphs as if fully and completely set forth herein. THIRTY-FIFTH: Plaintiff sent Defendant a letter demanding Appraisal and naming its appraiser. THIRTY-SIXTH: Defendant named its appraiser; Plaintiff objected to the named appraiser. 6 6 of 7
THIRTY-SEVENTH: The Appraisal has not yet begun and no umpire has been appointed. THIRTY-EIGHTH: Plaintiff seeks a Declaration from the Court that ALLIED be compelled to pay the amount which may be awarded in Appraisal. WHEREFORE, Plaintiff demands judgment against ALLIED in at least the sum of Thirteen Million Seven Hundred Twenty-Six Thousand Three Hundred Thirteen Dollars and 75/100 ($13,726,313.75) with interest from October 20, 2015, legal fees and other additional costs, fees and expenses which are expected to be incurred, as well as extra-contractual damages, and the costs and disbursements of this action. Date: New York, New York August 2, 2017 WILKOFSKY, FRIEDMAN, KAREL & CUMMINS DBK:tbh 20161/16J108.L1 By: _s/ DAVID B. KAREL Attorneys for Plaintiff 299 Broadway - Suite 1700 New York, New York 10007 (212) 285-0510 7 7 of 7