D'Aquilla Bros. Contracting Co. v. Hartford Acc. & Indem. Co.

• Decision Date: 06 October 1959
• Docket Number: No. 1,No. 2,1,2
• Citation: 22 Misc.2d 733,193 N.Y.S.2d 502
• Parties: D'AQUILLA BROTHERS CONTRACTING COMPANY, Inc., v. HARTFORD ACCIDENT AND INDEMNITY COMPANY. Action HARTFORD ACCIDENT AND INDEMNITY COMPANY v. LIBERTY MUTUAL INSURANCE COMPANY and D'Aquilla Brothers Contracting Company, Inc. Action
• Court: New York Supreme Court

Page 502

193 N.Y.S.2d 502

22 Misc.2d 733

D'AQUILLA BROTHERS CONTRACTING COMPANY, Inc., v. HARTFORD ACCIDENT AND INDEMNITY COMPANY.

Action No. 1.

HARTFORD ACCIDENT AND INDEMNITY COMPANY v. LIBERTY MUTUAL INSURANCE COMPANY and D'Aquilla Brothers Contracting Company, Inc.

Action No. 2.

Supreme Court, Trial Term, Queens County, Part I.

Oct. 6, 1959.

Thomas F. Keane, Brooklyn (James J. McIntosh, Jr., Brooklyn, of counsel), for Liberty Mut. Ins. Co.

Harold Schaffner, New York City (Joseph L. Schilling, New York City, of counsel), for Hartford Accident & Indemnity Co.

JOSEPH M. CONROY, Justice.

This consolidated action involves a dispute between two insurance companies as to the coverage of their respective policies of insurance.

On August 22, 1952, one Ralph Marigliano was injured at a housing project which was being constructed under the supervision of Efroy Construction Corp. as general contractor. The excavation work was being done by Frens Construction Co. Inc., a subcontractor. Marigliano rented his truck and his own services to Frens. While walking on the job site awaiting the loading of his truck, Marigliano was injured when a large rock fell from a truck owned by D'Aquilla Bros. Contracting Co. Inc. and driven by one of its employees. The truck had been loaded by a crane engaged in the work of Frens.

Marigliano subsequently recovered a judgment for $50,000 in the Supreme Court, Kings County, against Efroy, Frens and D'Aquilla. The judgment was satisfied by the payment of $15,000 by Efroy and $35,000 by D'Aquilla. Frens paid nothing.

D'Aquilla thereafter secured a judgment in contribution against Frens for $16,916.65, its pro rata share of Marigliano's judgment. Execution upon the judgment in contribution was returned unsatisfied. Demand was made upon Frens' insurance carrier, Hartford Accident and Indemnity Company, for payment of the judgment in contribution, but this demand was refused. D'Aquilla, then brought an action in the Supreme Court, Queens County, against Hartford, pursuant to section 167 of the Insurance Law. Hartford commenced an action in the Supreme Court, New York County, against D'Aquilla and its insurance carrier, Liberty Mutual Insurance Company, for a declaratory judgment. The two actions have been consolidated here.

Liberty's policy covering D'Aquilla was an 'Automobile Policy' covering D'Aquilla's liability for its trucks, including the one from which the rock fell on Marigliano. Hartford's policy covering Frens was a 'Manufacturers' and Contractors' Schedule Liability Policy' covering Frens' liability for operations at certain premises. The problem presented by this consolidated action is which of these policies should cover Frens' liability to Marigliano and, therefore, D'Aquilla's judgment in contribution.

Liberty's policy defined the word 'insured' to include the named insured and any person using an automobile owned or hired by the insured, provided such use was with the permission of the insured. Where similar policies have specifically defined the word 'use' to include loading and unloading, the courts have uniformly held that the person loading the automobile is an additional insured under the automobile policy. See Wagman v. American Fidelity & Casualty Co., 304 N.Y. 490, 109 N.E.2d 592; cf. Macy & Co. v. General Acc. Fire & Life Assur. Corp., 4 Misc.2d 89, 148 N.Y.S.2d 10.

The instant policy does not define the word 'use'. Therefore, while it does not specifically include loading and unloading as an authorized use, neither does it specifically exclude loading and unloading as an authorized use. This court finds that such activities are a proper use of the vehicle and that Frens, therefore, was covered by Liberty's policy as an additional insured.

The next question presented is whether Frens' liability to Marigliano was also covered by Hartford's policy. Said policy covered Frens' liability with respect to the 'ownership, maintenance or use of premises, and all operations necessary or incidental thereto.' (Definition of Hazards, Division 1.)

In its pleadings herein, Hartford virtually concedes that its policy would cover Frens unless such liability is excluded under subdivision (a)(1) of Exclusions, or unless Frens breached the contract of insurance by its failure to comply with condition 9 of the policy.

Condition 9 of Harford's policy provides:

'If claim is made or suit is brought against the Insured, the Insured shall immediately forward to the Company every demand, notice, summons or other process received by him or his representative.'

That Hartford had some knowledge of Marigliano's law suit cannot be denied. Marigliano's action against Frens was commenced by the service of a summons on October 13, 1953. Frens' present attorneys appeared in the action and the complaint was served on them on November 27, 1953. A copy of the complaint was apparently sent to Hartford by Marigliano's attorney on or about December 17, 1953 (Hartford's Ex. B). Hartford, after examining the complaint, wrote to Paltrow & Jensen, Esqs., attorneys for Frens, on December 22, 1953, advising them that on the basis of the allegations set forth in said complaint, 'there is no coverage for the accident under the terms of policy number, MCS 29993, by reason of Exclusion 2(i) of the policy' (D'Aquilla's Ex. 4). It is conceded that 'Exclusion 2(i)' was an error and that Hartford is relying upon Exclusion (a)(1) to justify its disclaimer of liability.

In view of Hartford's specification of the exclusion as the ground for its disclaimer and its failure to mention Condition 9 in its letter to Frens' attorneys, it must be deemed to have waived any defense based on breach of Condition 9. While the complaint may not have been forwarded by Frens, Hartford did receive a copy of it and it...