Alen Begonja, Plaintiff, v. JOHN INSULATION INC (2026)

I. INTRODUCTION

This is an action to recover damages for personal injuries, inter alia, arising from the violation of Labor Law § 240(1) by the defendants/third-party plaintiffs, RXR Construction Services, LLC (RXR), and City Winery NY-Pier 57, LLC (City Winery) (together the defendants). Specifically, the plaintiff sustained injuries on March 13, 2020 when he fell from a ladder in the course of his employment with the third-party defendant, John's Insulation, Inc. (JII), installing insulation material on duct work and pipes in the kitchen area on the ground floor of premises owned by City Winery. As relevant here, the RXR was the general contractor on the relevant construction project (the project), which involved the erection of a concert, dining, bar, and wine storage facility in Manhattan. Pursuant to an October 10, 2019 subcontract, RXR retained former party Fahrenheit Mechanical, LLC (Fahrenheit), as the heating, ventilation, and air conditioning (HVAC) subcontractor for the project. Pursuant to a November 8, 2019 purchase order and sub-subcontract, Fahrenheit retained JII to undertake insulation work, including the work that the plaintiff performed on the date of the subject accident. The defendants impleaded JII, asserting causes of action for contribution, common-law indemnification, contractual indemnification, and breach of contract for failure to procure appropriate insurance.

In a decision and order dated April 12, 2024, the court (David B. Cohen, J.) granted those branches of the plaintiff's motion which were for summary judgment on the issue of liability on his cause of action to recover damages for a violation of Labor Law § 240(1) against the defendants, and denied those branches of his motion which were for summary judgment on the issue of liability on that cause of action insofar as asserted against other defendants who were then still parties to the action (MOT SEQ 007). In a decision and order dated May 8, 2025, the Appellate Division, First Department, affirmed that order (see Begnoja [sic] v Hudson Riv. Park Trust, 238 AD3d 481 [1st Dept 2025]). All claims against named defendants other than RXR and City Winery, some of whom had also been impleaded as third-party defendants or second third-party defendants, were ultimately discontinued.

The main action was tried before a jury on 11 days between December 1, 2025 and December 17, 2025. The jury rendered a verdict in favor of the plaintiff and against the defendants, jointly and severally, in the total amount of $18,976,661, which, in addition to the stipulated amount of past medical expenses that had been incurred by the plaintiff in the sum of $246,219.75, brought the total award to $19,222,880.75. The jury also found that JII was at fault in the happening of the accident, that its negligence caused or contributed to the plaintiff's injury, and that the plaintiff sustained a "grave injury" within the meaning of Workers' Compensation Law § 11. It thus found in favor of the defendants on their third-party cause of action against JII for common-law indemnification. In a decision and order dated July 21, 2026, this court denied the defendants' motion to set aside the verdict against them as excessive and contrary to the weight of the evidence (MOT SEQ 011), and denied JII's separate motion to set aside the verdict against both the defendants and against it on the same grounds, as well as on the additional ground that the court should have instructed the jury as to the defendants' purported comparative fault, and should have directed the jury to apportion fault between JII and the defendants (MOT SEQ 010). The court also sua sponte dismissed, as abandoned, the common-law negligence, Labor Law § 200, and Labor Law § 241(6) causes of action that the plaintiff had asserted against the defendants in the main action, and sua sponte dismissed, as abandoned, the defendants' third-party causes of action against JII for contribution and breach of contract for failure to procure an appropriate policy of liability insurance.

On December 10, 2025, the defendants and JII had proceeded to a nonjury trial on the defendants' third-party cause of action against JII for contractual indemnification. In support of their claim, the defendants submitted a July 30, 2019 proposal generated by JII, referable to the performance of insulation work for the subject project, a November 8, 2019 purchase order and sub-subcontract between Fahrenheit and JII, and a separate May 5, 2020 contract between Fahrenheit and JII, along with a certificate of liability insurance identifying Merchants National Insurance Company as the primary insurer and American Alternative Insurance Group as an excess insurer. That certificate named JII as the insured and Fahrenheit as an additional insured. The defendants did not call any witnesses. JII adduced the testimony of John Perisa, its current sole owner. The court concludes that John Perisa testified credibly.

II. FINDINGS OF FACT

As of July 2019, John Perisa was the sole owner of JII, having taken over that position from his father. In a written proposal dated July 30, 2019, JII proposed to perform insulation work on the subject project at premises owned by City Winery. The written proposal did not identify on the face thereof the party to whom the proposal was meant to be given, or to whom the proposal actually was given. The proposal did not contain any provision purporting to or obligating JII to indemnify any other person or entity involved in the project. The proposal was unsigned. Prior to the generation of the July 30, 2019 proposal, neither John Perisa nor anyone on behalf of JII had engaged in discussions with Fahrenheit about entering into a written agreement to indemnify Fahrenheit or any other person or entity in the event that Fahrenheit were sued by any worker injured while working on the project, including any of JII's workers.

As of November 8, 2019, Edward Perisa, who was John Perisa's brother, was not an officer or employee of JII. John Perisa had authorized Edward Perisa to negotiate and sign contracts on behalf of JII. Edward Perisa negotiated a purchase order and sub-subcontract on behalf of JII with Fahrenheit, pursuant to which JII agreed to perform insulation installation work at the City Winery project for the sum of $188,000. That purchase order and sub-subcontract was dated November 8, 2019, was prepared by Fahrenheit, and did not include any provision or language pursuant to which JII agreed to indemnify either HVAC subcontractor Fahrenheit, general contractor RXR, or project owner City Winery. Prior to the entering into the November 8, 2019 purchase order and sub-subcontract, neither John Perisa nor anyone on behalf of JII had engaged in discussions with Fahrenheit about entering into a written agreement to indemnify Fahrenheit in the event that Fahrenheit were sued by any worker injured in the course of working on the project. Between November 8, 2019 and March 13, 2020, the date of the plaintiff's accident, neither John Perisa, nor anyone on behalf of JII, engaged in discussions with Fahrenheit concerning an indemnification agreement. Neither did JII or Fahrenheit exchange any proposed indemnification contracts or documents containing language meant to constitute the terms of a proposed indemnification agreement.

On May 5, 2020, Edward Perisa, on behalf of JII, and the president of Fahrenheit each signed a nine-page agreement, entitled General Services Contract, that was otherwise undated, and included three riders. The agreement was prepared by Fahrenheit. Rider A to that agreement provided that the contract applied to all work "to be performed" pursuant to the relevant purchase order, and/or "commencing within the effective dates of the Contract," that is commencing on May 5, 2020. The agreement further provided that JII was obligated to "purchase and maintain insurance" providing certain types of coverage. It also recited that

"To the fullest extent permitted by law, Subcontractor [JII] shall defend, indemnify and hold harmless Owner, Contractor, Architect, and consultants, agents and employees of any of them (individually or collectively, 'Indemnity') from and against all claims, damages, liabilities, losses and expense, including but not limited to attorney's fees, arising out of in any way connected with the performance or lack of performance of the work under the agreement and any change orders or additions to the work included in the agreement, provided that any such claim, damage, liability, loss or expense is attributable to bodily injury, sickness, disease or death, or physical injury to tangible property including loss of use of that property, or loss of use of tangible property that is not physically injured, caused in whole or in part by and actual or alleged:

"Act or omission of the Subcontractor or anyone directly or indirectly retained or engaged by it or anyone for whose acts it may be liable;

"Violation of any statutory duty, regulation, ordinance, rule or obligation by an Indemnitee provided that the violation arises out of or is in any way connected with the Subcontractor's performance or lack of performance of the work under the agreement."

John Perisa did not himself have any discussions with anyone from Fahrenheit concerning that agreement prior to the date that it was signed by Edward Perisa. There was no express or explicit language set forth in that agreement making JII's obligation to indemnify Fahrenheit, RXR, or City Winery retroactive to the beginning of JII's work on the project, or retroactive to March 13, 2020, the date of the plaintiff's accident.

JII occasionally obligated itself pursuant to a written contract to indemnify contractors or subcontractors in connection with injured workers' claims, but did not do so all of the time.

The relevant certificate of liability insurance identified Fahrenheit as the certificate holder. That certificate established that JII had obtained liability insurance coverage referable to the project. The certificate identified Merchants National Insurance Company as the primary insurer, with limits of coverage in the sum of $1,000,000, and American Alternative Insurance Group as an excess insurer, with limits of coverage in the sum of $5,000,000. The certificate named JII as the insured and Fahrenheit as an additional insured, the latter on a primary, noncontributory basis. The certificate further required that any insurance purchased by JII include a contractual liability endorsement. The certificate did not, in and of itself, include language expressly compelling JII to execute any indemnification agreement, and the certificate did not include any language or provision obligating JII to execute an indemnification agreement specifically in favor of Fahrenheit, RXR, or City Winery.

The subcontract between RXR and Fahrenheit required Fahrenheit to secure an indemnification agreement from any sub-subcontractor that Fahrenheit retained. The defendants adduced no testimony adduced with respect to this issue, and no representative of Fahrenheit was called to testify about any negotiations between Fahrenheit and JII with respect to whether Fahrenheit attempted to obtain an indemnification agreement from JII prior to the latter's commencement of work on the project or prior to the date of the plaintiff's accident.

The May 5, 2020 contract containing the indemnification clause post-dated the date of the subject March 13, 2020 accident by almost two months.

III. CONCLUSIONS OF LAW

Although Workers' Compensation Law § 11 bars third-party claims for contribution and common-law indemnification against an employer unless the plaintiff/employee sustained a "grave injury" that was caused by the employer's negligence (see New York Hosp. Med. Ctr. of Queens v Microtech Contr. Corp., 22 NY3d 501, 505 [2014]), that statute "does not bar indemnification . . . pursuant to a written agreement that was entered into after the employee's injury and which the parties agree will have retroactive effect (see Stabile v Viener, 291 AD2d 395, 396 [2002])" (Cacanoski v 35 Cedar Pl. Assoc., LLC, 147 AD3d 810, 812 [2d Dept 2017]). Nonetheless,

'indemnity contracts are to be strictly construed to avoid reading into them duties which the parties did not intend to be assumed' (Mikulski v Adam R. West, Inc., 78 AD3d [910,] 911 [2d Dept 2010]). Therefore, an indemnity contract will not be held to have retroactive effect 'unless by its express words or necessary implication it clearly appears to be the parties' intention to include past obligations' (Kane Mfg. Corp. v Partridge, 144 AD2d 340, 341 [2d Dept 1988]; see Mikulski v Adam R. West, Inc., 78 AD3d at 911)"

(Cacanoski v 35 Cedar Pl. Assoc., LLC, 147 AD3d at 812-813 [emphasis added]; see Jeda Capital-56, LLC v Village of Potsdam, 198 AD3d 1211, 1217 [3d Dept 2021]). In other words, retroactivity will not necessarily be implied (see Morin v Heritage Bldrs. Group, LLC, 211 AD3d 1138, 1144 [3d Dept 2022]). In the instant matter, "[t]here was no indemnification agreement in existence at the time of the accident and no proof that the indemnification clause in the subsequently executed contract was to be afforded retroactive effect" (DeJesus v Sweet Constr. Corp., 192 AD3d 416, 416 [1st Dept 2021]; see Temmel v 1515 Broadway Assoc., L.P., 18 AD3d 364, 365 [1st Dept 2005]; Perez Juarez v Rye Depot Plaza, LLC, 140 AD3d 464, 465 [1st Dept 2016]; Burke v Fisher Sixth Ave. Co., 287 AD2d 410, 410 [1st Dept 2001] ["contracts purportedly incorporating the attachments containing the indemnity . . . clause( ) underlying the third-party complaint were dated and executed after plaintiff's accident . . . [and] there is nothing about these contracts to suggest that they were intended to have retroactive effect"]; see also Johnson v UniFirst Corp., 67 AD3d 1442, 1443 [4th Dept 2009] [no contractual indemnification permitted because subject indemnification contract "was not in effect at the time of plaintiff's accident," but had instead expired]; Soto v Village JV 500 E. 11th, LLC, 2016 NY Slip Op 32106[U], 2016 NY Misc LEXIS 3956, *8 [Sup Ct, NY County, Oct. 20, 2016] [contract containing indemnification clause "clearly establishes that it is not effective until . . . a date subsequent to the date of plaintiff's accident," and, thus, third-party defendant's "contractual obligations did not exist at the time of the alleged accident"]). In this respect, not only was there no express language contained in the indemnification provision of the May 5, 2020 agreement that would even suggest that that agreement was meant to be applied retroactively, there were no indicia whatsoever presented to the court that would create a necessary implication that it "clearly appeared" to be the parties' intention to include past obligations within the ambit of the indemnification clause. Specifically, there was no testimony that, prior to May 5, 2020, anyone on behalf of JII made a promise on behalf of JII that it would agree to memorialize, in a later writing, a previously agreed-upon obligation to indemnify Fahrenheit, RXR, or City Winery, let alone evidence that anyone on behalf of JII even spoke with a representative of those entities in connection with a possible indemnification agreement.

Moreover, the certificate of liability insurance did not obligate JII to execute an indemnification agreement, but only obligated it to obtain liability insurance that, among other things, included a contractual liability endorsement which, in and of itself, did not obligate JII to execute a indemnification agreement (see Delos Ins. Co. v STL Associates, LLC, 2010 NY Slip Op 30157[U], *3-4, 2010 NY Misc LEXIS 1376, *3 [Sup Ct, NY County, Jan. 22, 2010] [Gische, J.] [contractual liability endorsement is triggered only where a named insured actually enters into a contract or subcontract containing an indemnification clause]). In addition, the mere fact that Fahrenheit's subcontract with RXR required Fahrenheit to secure an agreement from any sub-subcontractor that the latter retained that would indemnify RXR and City Winery does not constitute evidence that Fahrenheit actually secured such an agreement prior to March 13, 2020, and does not constitute evidence that JII itself had agreed to indemnify Fahrenheit, RXR, or City Winery, or even knew that it was required to sign such an indemnification agreement.

IV. CONCLUSION

Consequently, the court concludes that the defendants are not entitled to contractual indemnification from JII in connection with the damages sustained by the plaintiff for which the defendants have been found liable, and that third-party cause of action must thus be dismissed.

In light of the foregoing, it is,

ORDERED that the third-party causes of action for contractual indemnification that the defendants/third-party plaintiffs, RXR Construction Services, LLC, and City Winery NY-Pier 57, LLC, have asserted against the third-party defendant, John's Insulation, Inc., are dismissed; and it further,

ORDERED that the third-party causes of action for contractual indemnification that the defendants/third-party plaintiffs, RXR Construction Services, LLC, and City Winery NY-Pier 57, LLC, have asserted against the third-party defendant, John's Insulation, Inc., are severed; and it is further,

ORDERED that the Clerk of the court shall enter judgment dismissing the third-party causes of action for contractual indemnification that the defendants/third-party plaintiffs, RXR Construction Services, LLC, and City Winery NY-Pier 57, LLC, have asserted against the third-party defendant, John's Insulation, Inc.

This constitutes the Decision and Order After Nonjury Trial of the court.

DATE 7/23/2026

JOHN J. KELLEY, J.S.C.

John J. Kelley, J.