In Regal Constr. Corp. v. Nat'l Union Fire Ins. Co. of Pittsburg, PA (15 NY3d 34, 38, 930 N.E.2d 259, 904 N.Y.S.2d 338 ), an employee of Regal, a "prime contractor" which performed demolition and renovation operations for URS, slipped on a recently painted metal joist, which Regal alleged had been painted by employees of the construction manager URS.
The underlying complaint only alleged negligence by URS. The Court of Appeals held that "if a complaint contains any facts or allegations which bring the claim even potentially within the protection purchased, the insurer is obligated to defend. This standard applies equally to additional insureds and named insureds." (Regal, 15 NY3d at 37).
The Court relied for its reasoning on the language from Consolidated Edison Co. of New York v. Hartf. Ins. Co., 203 AD2d 83, 610 N.Y.S.2d 219 (1st Dep't 1994), which indicates that courts will focus on the general nature of the operation when the accident was sustained, rather than speculate as to the precise cause of the accident.
In Regal Const., the employment relation between the injured claimant and the named insured satisfied this basic causation standard. Finally, the Court clarified: "That the underlying complaint alleges negligence on the part of URS and not Regal is of no consequence, as URS's potential liability for LeClair's injury arose out of' Regal's operation." (Id., 15 NY3d at 39).
Neither was it significant that the named insured, Regal, had not been named as a defendant in the underlying action. (Id., 15 NY3d at 37).