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`UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF NEW YORK
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`TRAVELERS CASUALTY AND SURETY
`COMPANY OF AMERICA,
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`v.
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`MARY ELLEN BELDING, et al.,
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`Defendants.
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`_______________________________________
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`Plaintiff,
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`DECISION & ORDER
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`16-CV-6559P
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`PRELIMINARY STATEMENT
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`On August 9, 2016, plaintiff Travelers Casualty and Surety Company of America
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`(“Travelers”) commenced this action against defendants Mary Ellen Belding, Jon R. Belding,
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`and Structural Remediation Services, Inc. (“SRS”) seeking to recover under an indemnity
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`agreement executed by defendants in favor of Travelers. (Docket # 1). Currently before the
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`Court is Travelers’ unopposed motion for summary judgment. (Docket # 15). For the following
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`reasons, the motion is granted.
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`FACTUAL BACKGROUND
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`The following facts are undisputed.1 On December 30, 2016, in consideration for
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`Travelers’ agreement to issue surety bonds on behalf of SRS in connection with certain
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`1 In compliance with Rule 56(a)(1) of the Local Rules of Civil Procedure for the Western District of New
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`York, Travelers filed a Statement identifying undisputed material facts. (Docket # 15-1). Defendants have not filed
`an opposing statement, and the Court thus considers Travelers’ Rule 56 Statement undisputed. See W.D.N.Y. L.R.
`Civ. P. 56(a)(2) (“[e]ach numbered paragraph in the moving party’s statement of material facts may be deemed
`admitted for the purposes of the motion unless it is specifically controverted by a correspondingly numbered
`paragraph in the opposing statement”).
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 2 of 8
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`construction projects (“the Bonded Projects”), Mary Ellen Belding, Jon Belding and SRS (by
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`Mary Ellen Belding) executed a General Agreement of Indemnity (the “Indemnity Agreement”).
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`(Docket ## 15-1 at ¶ 1; 15-4). The terms of the Indemnity Agreement provide that the
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`“Indemnitors shall exonerate, indemnify and save [Travelers] harmless from and against all
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`Loss” and that “[a]n itemized, sworn statement by an employee of [Travelers], or other evidence
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`of payment, shall be prima facie evidence of the propriety, amount and existence of Indemnitors’
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`liability.” (Docket ## 15-1 at ¶ 2; 15-4 at ¶ 3). Loss is defined in the Agreement to mean:
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`All loss and expense of any kind or nature, including attorneys’
`and other professional fees, which [Travelers] incurs in connection
`with any Bond or this Agreement, including, but not limited to all
`loss and expense incurred by reason of [Travelers’]: (a) making
`any investigation in connection with any Bond; (b) prosecuting or
`defending any action in connection with any Bond; (c) obtaining
`the release of any Bond; (d) recovering or attempting to recover
`Property in connection with any Bond or this Agreement;
`(e) enforcing by litigation or otherwise any of the provisions of this
`Agreement; and (f) all interest accruing thereon at the maximum
`legal rate.
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`(Docket ## 15-1 at ¶ 3; 15-4 at ¶ 1). Following defendants’ execution of the Indemnification
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`Agreement, Travelers issued four surety bonds on behalf of SRS – three public construction
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`payment bonds and one union benefits bond. (Docket ## 15-1 at ¶¶ 4-5; 15-5).
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`Travelers has submitted a sworn affidavit of Barbara A. Check, a Bond Claim
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`Executive employed in Travelers’ Recovery Management Unit, affirming that Travelers paid
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`bond claims totaling $450,747.63 to various subcontractors, suppliers, and laborers of SRS on
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`Bonded Projects. (Docket # 15-3 at ¶¶ 1, 15-18, 23-25). Attached to Check’s affidavit is an
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`itemized statement of the claims paid, which Check has represented is an accurate and complete
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`list of payments made on the bonds, along with additional records of payment. (Docket ## 15-3
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`at ¶¶ 16, 23; 15-6; 15-7). According to Check’s affidavit, Travelers also paid $15,099.20 in fees
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`2
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 3 of 8
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`to a surety claims construction consulting firm, Loewke & Brill Consulting Group, retained by
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`Travelers to assist in the investigation of claims on the bonds, and $20,511.20 in fees to its
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`attorneys in this lawsuit. (Docket # 15-3 at ¶¶ 19-23). Records reflecting payments made to the
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`consulting firm and to Travelers’ attorneys are attached to Check’s affidavit. (See Docket
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`## 15-8; 15-9). Defendants have not reimbursed Travelers for any of these payments or fees.
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`(Docket ## 15-3 at ¶¶ 24-25; 15-1 at ¶¶ 7-12; 1 at ¶¶ 17, 26; 7 at ¶¶ 17, 26).
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`On August 9, 2016, Travelers filed the pending Complaint seeking reimbursement
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`of bond payments, fees and expenses from SRS as principal on the bonds and from all
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`defendants as Indemnitors pursuant to the terms of the Indemnity Agreement. (Docket # 1). On
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`March 8, 2017, Travelers filed the instant motion for summary judgment seeking judgment
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`against the defendants on its claim that they breached the Indemnity Agreement. (See Docket
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`# 15-2 at 4). Travelers seeks judgment in the amount of $465,846.85, consisting of $450,747.63
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`in claim payments and $15,099.20 in consulting fee payments. (Docket # 15). It also seeks
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`judgment for attorneys’ fees, the amount to be determined at an inquest. (Id.).
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`Despite the issuance of scheduling orders setting deadlines for defendants to
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`respond to Travelers’ summary judgment motion (Docket ## 16, 23), defendants have not
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`opposed the motion. Indeed, counsel for defendants represented in a letter to this Court dated
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`July 31, 2017, that defendants “have not submitted opposing paper nor do they intend to contest
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`Travelers’ motion.” (Docket # 27). Two days later, counsel for Travelers submitted a proposed
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`Order and Judgment that was reviewed and consented to by counsel for defendants. (Docket
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`# 28).
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`3
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 4 of 8
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`DISCUSSION
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`Summary judgment is appropriate “if the movant shows that there is no genuine
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`dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
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`Fed. R. Civ. P. 56(a). In reaching this determination, the court must assess whether there are any
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`disputed material facts and, in so doing, must resolve all ambiguities and draw all reasonable
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`inferences against the moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49
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`(1986); Coach Leatherware Co., Inc. v. AnnTaylor, Inc., 933 F.2d 162, 166-67 (2d Cir. 1991). A
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`fact is “material” only if it has some effect on the outcome of the suit. Anderson v. Liberty
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`Lobby, Inc., 477 U.S. at 248; Konikoff v. Prudential Ins. Co. of Am., 234 F.3d 92, 97 (2d Cir.
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`2000). A dispute regarding a material fact is genuine “if the evidence is such that a reasonable
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`jury could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248; see also
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`Konikoff v. Prudential Ins. Co. of Am., 234 F.3d at 97.
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`The moving party bears the initial burden of demonstrating the absence of a
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`genuine issue of material fact, after which the non-moving party must come forward with
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`sufficient evidence to support a jury verdict in its favor; the motion will not be defeated based
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`upon conjecture, surmise or the existence of “metaphysical doubt” concerning the facts. Bryant
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`v. Maffucci, 923 F.2d 979, 982 (2d Cir.) (citing Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio
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`Corp., 475 U.S. 574, 586 (1986)), cert. denied, 502 U.S. 849 (1991). The party seeking to avoid
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`summary judgment “must do more than make broad factual allegations and invoke the
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`appropriate statute. The [party] must also show, by affidavits or as otherwise provided in
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`Rule 56 . . . , that there are specific factual issues that can only be resolved at trial.” Colon v.
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`Coughlin, 58 F.3d 865, 872 (2d Cir. 1995); see also Driscoll v. Townsend, 60 F. Supp. 2d 78, 80
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`(W.D.N.Y. 1999).
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`4
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 5 of 8
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`As the Second Circuit has explained:
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`[T]he trial court’s task at the summary judgment motion stage of
`the litigation is carefully limited to discerning whether there are
`any genuine issues of material fact to be tried, not to deciding
`them. Its duty, in short, is confined at this point to issue-finding; it
`does not extend to issue-resolution. . . . [I]t must be kept in mind
`that only by reference to the substantive law can it be determined
`whether a disputed fact is material to the resolution of the dispute.
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`Gallo v. Prudential Residential Serv., Ltd. P’ship, 22 F.3d 1219, 1224 (2d Cir. 1994).
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`A party’s failure to oppose a summary judgment motion, standing alone, is not
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`sufficient to warrant granting the motion; rather, the court must “still assess whether the moving
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`party has fulfilled its burden of demonstrating that there is no genuine issue of material fact and
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`its entitlement to judgment as a matter of law.” Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373
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`F.3d 241, 244 (2d Cir. 2004). Thus, in evaluating a motion for summary judgment, the court
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`“must review the motion, even if unopposed, and determine from what it has before it whether
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`the moving party is entitled to summary judgment as a matter of law.” Id. at 246 (internal
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`quotations omitted).
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`Under New York law,2 an indemnity agreement is valid and enforceable. N. Am.
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`Specialty Ins. Co. v. Montco Constr. Co., 2003 WL 21383231, *5 (W.D.N.Y. 2003). Indeed, “a
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`surety’s right to indemnification for its losses and expenses under a bond has been consistently
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`upheld in New York.” Fidelity & Deposit Co. of Md. v. Refine Constr. Co., 1984 WL 536, *3
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`2 The law is well-settled that in cases arising under diversity jurisdiction, the court must apply federal
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`procedural law and the substantive law of the state in which it sits. Erie R. Co. v. Tompkins, 304 U.S. 64 (1938).
`Thus, in this matter, the Court must apply New York’s choice of law rules. Stuart v. Am. Cyanamid Co., 158 F.3d
`622, 626 (2d Cir. 1998) (citing Guaranty Trust Co. of New York v. York, 326 U.S. 99, 108-09 (1945) and Klaxon Co.
`v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941)), cert. denied, 526 U.S. 1065 (1999). Travelers relies upon New
`York law in its motion (Docket # 15-2 at 9-10), and defendants, who have not opposed the motion, do not contest its
`applicability. On this record, this Court will apply New York law.
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 6 of 8
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`(S.D.N.Y. 1984) (collecting cases). Where the terms of an indemnity agreement are
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`unambiguous,
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`the Court must give effect to the express rights and obligations of
`the parties contained therein and such interpretation is an issue of
`law that may be determined on a motion for summary judgment.
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`N. Am. Specialty Ins. Co. v. Montco Constr. Co., 2003 WL 21383231 at *5.
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`The record before the Court establishes that defendants executed the Indemnity
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`Agreement in favor of Travelers in consideration for Travelers’ issuance of surety bonds on
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`behalf of SRS. (Docket ## 1 at ¶¶ 8-11; 7 at ¶¶ 8-11; 15-1 at ¶¶ 1-5; 15-4; 15-5). The terms of
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`the Indemnity Agreement clearly and unambiguously obligate defendants to repay Travelers for
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`any “Loss” it sustains under the surety bonds. (Docket ## 15-1 at ¶ 2; 15-4). Specifically,
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`paragraph 3 of the Agreement provides, “Indemnitors shall exonerate, indemnify and save
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`[Travelers] harmless from and against all Loss.” (Id.). “Loss” is broadly, but unambiguously,
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`defined in the Agreement to include the payments for which Travelers seeks reimbursement on
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`this motion – payments to subcontractors, suppliers and laborers on Bonded Projects and fees
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`paid to investigate and litigate claims on the bonds. (Docket ## 15-1 at ¶ 3; 15-4 at ¶ 1). The
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`record further demonstrates that Travelers has the right “in its sole discretion” to determine
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`whether to pay any claim under the bonds (Docket # 15-4 at ¶ 4) and did pay claims on the bonds
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`and incur covered losses, which defendants have not repaid. (Docket ## 15-3 at ¶¶ 15-25; 15-6;
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`15-7; 15-8; 15-9; 1 at ¶ 17; 7 at ¶ 17). Travelers has demonstrated that no material dispute exists
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`that defendants are liable to it under the Indemnity Agreement. See N. Am. Specialty Ins. Co.,
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`2003 WL 21383231 at *7 (granting summary judgment to surety where court “finds that
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`[defendant] breached . . . the Indemnity Agreement by failing to post collateral or otherwise
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`exonerate and indemnify [surety] for its losses incurred as a result of issuing [b]ond “); Fidelity
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 7 of 8
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`& Deposit Co. of Md. v. Refine Constr. Co., 1984 WL 536 at *4 (“there is . . . no issue of fact as
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`to the liability of the defendants under the [indemnity] [a]greement[;] [a]ccordingly, summary
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`judgment will be granted on the issue of liability”).
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`The Indemnity Agreement further provides that “[a]n itemized, sworn statement
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`by an employee of [Travelers], or other evidence of payment, shall be prima facie evidence of
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`the propriety, amount and existence of Indemnitors’ liability.” (Docket ## 15-1; 15-4 at ¶ 3).
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`“Such clauses [which specify that certain evidence or payments will be considered prima facie
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`proof of losses] have been upheld as valid under both federal and New York law.” Fidelity &
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`Deposit Co. of Md., 1984 WL 536 at *2 (citing Transamerica Ins. Co. v. Bloomfield, 401 F.2d
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`357, 362 (6th Cir. 1968); Standard Accident Ins. Co. v. Higgins, 170 N.Y.S.2d 73, 75 (N.Y. Sup.
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`Ct. 1957)). Travelers has complied with the terms of the Indemnity Agreement by submitting a
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`sworn statement by one of its Bond Claim Executives attesting to the type and amount of losses
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`sustained by Travelers in connection with the surety bonds issued on behalf of SRS and by
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`submitting an itemized statement of claims paid and claim payment reports and records. (Docket
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`## 15-3; 15-6; 15-7; 15-8; 15-9). That evidence is adequate to establish that defendants are
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`liable to Travelers, jointly and severally, for the sum of $465,846.85, comprised of bond
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`payments totaling $450,747.63 and consultant fees of $15,099.20. Indeed, defendants reviewed
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`and consented to a proposed order and judgment submitted by Travelers in that same amount.
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`(Docket # 28). Defendants are also liable for attorneys’ fees in an amount to be subsequently
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`determined, either by stipulation between the parties or further Order of this Court. If no
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`stipulation has been filed prior to March 9, 2018, Travelers shall file on or before March 9,
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`2018, affidavits establishing its calculation of attorneys’ fees to be reimbursed by defendants;
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`defendants shall respond thereto on or before March 21, 2018.
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`Case 6:16-cv-06559-MWP Document 29 Filed 02/09/18 Page 8 of 8
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`CONCLUSION
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`For the foregoing reasons, Travelers’ motion for summary judgment against
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`defendants Mary Ellen Belding, Jon R. Belding, and Structural Remediation Services, Inc.
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`(Docket # 15) is GRANTED. Judgment shall be awarded in favor of Travelers Casualty and
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`Surety Company of America against defendants, jointly and severally, in the amount of
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`$465,846.85, and for attorneys’ fees in an amount to be determined by this Court upon
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`stipulation of the parties or following further briefing.
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`IT IS SO ORDERED.
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`Dated: Rochester, New York
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`February 9, 2018
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` s/Marian W. Payson
` MARIAN W. PAYSON
`United States Magistrate Judge
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`8
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