McCormick & Co., Inc. v. Empire Ins. Group
| Decision Date | 29 February 1988 |
| Docket Number | No. 87 Civ. 4197 (CLB).,87 Civ. 4197 (CLB). |
| Parties | McCORMICK & COMPANY, INC., Plaintiff, v. EMPIRE INSURANCE GROUP, Allcity Insurance Company and Empire Mutual Insurance Company, Defendants. |
| Court | U.S. District Court — Southern District of New York |
John P. D'Ambrosio, Elmsford, N.Y., for plaintiff.
Robert Lubitz, Weiner, Ostrager, Fieldman & Zucker, New York City, for defendants.
Plaintiff and the defendants have each moved for summary judgment pursuant to Rule 56 Fed.R.Civ.P., by motions heard on December 21, 1987, and marked fully submitted January 18, 1988, after receipt of an addendum to the plaintiff's supplemental memorandum of law.
The plaintiff won a $68,989.36 judgment against Jay Storage for the loss of 290 bags of pepper in an earlier action in this Court, 86 Civ. 6118. The plaintiff now seeks to enforce that judgment against the defendants, Jay Storage's insurers, pursuant to Section 3420(a)(2), N.Y.Insur.Law, which provides in substance for a direct action against the insurer, under the conditions set forth therein. Under that statute the judgment creditor's rights are no greater and no less than those of the insured under the policy, and recovery can not exceed the policy limits.
There is no dispute between the parties that the defendants provided Jay Storage with "warehousemans legal liability insurance," which was in full force and effect during the period in which the loss took place. The plaintiff bases its motion for summary judgment on Section 1(a)(1) of the policy in which the insurer agreed:
"To pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay by reason of liability imposed upon him as a warehouseman or bailee for loss or destruction of or damage to personal property of others contained in the premises hereinafter specified, occuring while this policy remains in full force and effect."
The defendants oppose the plaintiff's motion and make their own motion for summary judgment based upon an exclusionary clause in the policy which states:
The defendants contend that this exclusionary clause covers the loss of pepper since it is an "Unexplained loss" or "mysterious disappearance," and they offer affidavits in support of their motion which tend to rule out the possibility of burglary. The plaintiff has offered no explanation for the loss.
On May 16, 1984, Jay Storage received from Jantzeen & Deeke, Inc. 430 bags of black pepper for storage in its warehouse in Brooklyn, New York. On August 25, 1984, Jantzeen & Deeke sold the bags of pepper to plaintiff McCormick & Company, Inc. ("McCormick"), a well known packer and dealer in spices. When McCormick sent a truck to claim a portion of its bags of pepper on February 15, 1985, Jay Storage could not locate 290 bags. These bags have never been found.
An affidavit of Mr. Vincent Murray, the owner and President of Jay Storage, states that during the period the plaintiff stored its pepper at Jay Storage, there were no reported incidents of forced entry or theft on the premises, a night watchman was on duty at off-hours and the company was never notified by its alarm company, Wells-Fargo Alarm Services, of an activated alarm. The defendants also submit the affidavit of the Operations Secretary of Wells Fargo Alarm...
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