Some of the most important and complex legal disputes in America are handled by the United States District Court for the Southern District of New York.  So it’s a good thing that the vexing question -- when are renovations to a bathroom in an office building complete? -- landed in Lower Manhattan. 

In March 2015, Hajdine Shuku was performing janitorial services in a 12th floor bathroom of law firm Mayer Brown’s New York City office.  Ms. Shuku alleges that, while cleaning the bathroom, a stall door fell off and hit her.  She filed suit against Mayer Brown, as tenant, and 1221 Avenue Holdings, LLC, its landlord.  Construction work had previously been performed in the bathroom. You know where this is going.  It didn’t take long before various construction companies/contractors were parties to the suit.  And then it didn’t take long before a dispute over additional insured coverage arose.

I’ll try to keep it simple.  These kinds of cases have a way of getting bogged down with many parties’ names, who’s suing whom, who insured this party and that party, who’s seeking additional insured coverage from whom, etc.

There were two liability insurers involved.  Travelers insured J.T. Magen, the construction company that Mayer Brown contracted with to do work in its office.  Netherlands Insurance Company issued a policy to Division Ten, which signed a purchase order to perform work for Magen in connection with the bathrooms.  The Netherlands policy contained some additional insured endorsements.  Again, keeping it simple, Travelers sought additional insured coverage from Netherlands for Travelers’ insureds – Magen, Mayer Brown and 1221 Avenue Holdings.  Netherlands denied Travelers’s tender.  

Two of the Netherlands additional insured endorsements – one being Scheduled Person and the other affording additional insured coverage to an entity that the insured is contractually obligated to name as an additional insured – contained the following exclusion:

This insurance does not apply to "bodily injury" or "property damage" occurring after:

2. That portion of “your work” out of which the injury or damage arises has been put to its intended use by any person or organization other than another contractor or subcontractor engaged in performing operations for a principal as a part of the same project.

Netherlands argued that this exclusion applied.  Travelers disagreed.  The court in Travelers Prop. Cas. Co. of Am. v. Neth. Ins. Co., No. 21-6061 (S,D.N.Y. Mar. 1, 2023), after examining when the construction work in the office bathroom was complete, sided with Netherlands.  To reach its conclusion, the court made the following observations about how bathrooms work:

“From the fact of Shuku’s presence late at night cleaning the Mayer Brown bathrooms arises the inference—the only reasonable one—that Shuku was cleaning bathrooms that needed upkeep, that is, ones in use by individuals during the day.  Travelers, despite the opportunity, has not adduced any evidence on which to infer that she was performing janitorial service in the bathrooms in the midst of the construction process.”

Second, and interestingly, just days before the incident in question, the Mayer Brown bathroom had been the source of some excitement.  Two people got stuck in bathroom stalls -- as well as a member of the maintenance crew.  Luckily, he has a screwdriver with him and was able to get out without assistance.    

From this situation, the court concluded that this could only mean one thing: “[T]hat ordinary bathroom users (law firm’s employees or visitors) had become stuck in the bathroom stalls while trying to use them for their intended purpose. That one of the issues raised involved the bathroom locks getting stuck makes all the more reasonable the inference that the persons inside were using the toilets to relieve themselves, as opposed to being present to do ongoing construction work.”

The court rejected Travelers’s argument that, while most of the work on the bathrooms has been completed at the time of the injury, it was not all completed.  Essentially, as the court saw it, whatever work was left to be done were “punch list” items, a situation not inconsistent with the regular use of a premises having been resumed.    
   

To my surprise, I used no bathroom puns here!  Not that I didn’t think off some. I stopped counting at ten.