Hartford Underwriting Ins. Co. v. Greenman-Pederson, Inc.

• Decision Date: 26 November 2013
• Citation: 975 N.Y.S.2d 736,2013 N.Y. Slip Op. 07842,111 A.D.3d 562
• Court: New York Supreme Court — Appellate Division
• Parties: HARTFORD UNDERWRITING INSURANCE COMPANY, Plaintiff–Respondent–Appellant, v. GREENMAN–PEDERSON, INC., et al., Defendants–Respondents, The Port Authority of New York & New Jersey, et al., Defendants–Appellants–Respondents, Koch Skanska USA, et al., Defendants.

111 A.D.3d 562

975 N.Y.S.2d 736

2013 N.Y. Slip Op. 07842

HARTFORD UNDERWRITING INSURANCE COMPANY, Plaintiff–Respondent–Appellant,

v. GREENMAN–PEDERSON, INC., et al., Defendants–Respondents,The Port Authority of New York & New Jersey, et al., Defendants–Appellants–Respondents,Koch Skanska USA, et al., Defendants.

Supreme Court, Appellate Division, First Department, New York.

Nov. 26, 2013.

Conway, Farrell, Curtin & Kelly P.C., New York (Jonathan T. Uejio of counsel), for appellants-respondents.

Lazare, Potter & Giacovas, LLP, New York (Stephen M. Lazare of counsel), for respondent-appellant.

Herzfeld & Rubin, P.C., New York (David B. Hamm of counsel), for Greenman–Pederson, Inc., respondent.

Carroll McNulty & Kull LLC, New York (Kristin V. Gallagher of counsel), for Continental Casualty Company, respondent.

MAZZARELLI, J.P., ACOSTA, MOSKOWITZ, MANZANET–DANIELS, GISCHE, JJ.

Order, Supreme Court, New York County (Carol Edmead, J.), entered August 15, 2012, which superseded a March 9, 2012 order, granted defendant Greenman–Pederson, Inc.'s (GPI) cross motion for summary judgment and declared that plaintiff Hartford and defendant-appellant Syndicate 2020 at Lloyd's of London (Lloyd's) had a duty to defend and indemnify GPI in the underlying action, and denied Hartford's motion and Lloyd's cross motion for summary judgment seeking declaratory relief against GPI, denied defendant-respondent Continental Casualty Company's (Continental) cross motion for summary judgment seeking a declaration that its policy was excess to the Hartford and Lloyd's policies, and granted GPI's motion for summary judgment for reasonable attorneys's fees against Hartford in defending this action and referred the issue of the amount of such fees to a special referee, unanimously affirmed, without costs. Appeals from orders, same court and Justice, entered March 9, 2012 and June 26, 2012, unanimously dismissed, without costs, as academic.

“[I]t is the responsibility of the insurer to explain its delay” (First Fin. Ins. Co. v. Jetco Contr. Corp, 1 N.Y.3d 64, 70, 769 N.Y.S.2d 459, 801 N.E.2d 835 [2003] ). Hartford undisputably had a pre-claim report of the 200 accident in 2006. Hartford had every opportunity to investigate and disclaim, yet it failed to do so until at least 2009, fully one year after GPI was added to the underlying action as a defendant.

Hartford claims that its duty to disclaim was not triggered until it received the summons and complaint, yet, “once the insurer has sufficient knowledge of facts entitling it to disclaim, or knows that it will disclaim coverage, it must notify the policyholder in writing as soon as is reasonably possible” (id. at 66, 769 N.Y.S.2d 459, 801 N.E.2d 835). Even assuming that Hartford's duty to disclaim was not triggered until it received the complaint in 2008, Hartford fails to explain why it did not disclaim until 2009.

Hartford's contention that its reservation of rights letters, issued in 2006 and 2008, constituted a clear disclaimer of coverage should be rejected. While the language in QBE Ins. Corp. v. Jinx–Proof Inc., 102 A.D.3d 508, 511, 959 N.Y.S.2d 19 [1st Dept.2013], a case on which Hartford relies, clearly stated that “QBE...