Mary & Alice Ford Nursing Home Co., Inc. v. Fireman's Ins. Co. of Newark, N.J.

• Decision Date: 28 January 1982
• Citation: 86 A.D.2d 736,446 N.Y.S.2d 599
• Court: New York Supreme Court — Appellate Division
• Parties: MARY & ALICE FORD NURSING HOME CO., INC., Respondent, v. FIREMAN'S INSURANCE CO. OF NEWARK, NEW JERSEY, Appellant.

Page 599

446 N.Y.S.2d 599

86 A.D.2d 736

MARY & ALICE FORD NURSING HOME CO., INC., Respondent, v. FIREMAN'S INSURANCE CO. OF NEWARK, NEW JERSEY, Appellant.

Supreme Court, Appellate Division,

Third Department.

Jan. 28, 1982.

Carter, Conboy, Bardwell, Case & Blackmore, Albany (Maureen S. Bonanni, Schenectady, of counsel), for appellant.

Wertime, Robinson & Ries, Cohoes (Stephen J. Van Ullen, Albany, of counsel), for respondent.

Before MAHONEY, P. J., and SWEENEY, CASEY, WEISS and KANE, JJ.

MEMORANDUM DECISION.

Appeal from an order of the Supreme Court at Special Term, entered August 5, 1980 in Albany County, which denied defendant's motion to dismiss the complaint for failure to state a cause of action.

Following her discharge from plaintiff's employ, Kathleen Wood and her husband commenced an action for damages against plaintiff alleging that she was discharged due to a disability, in violation of section 296 of the Executive Law. Plaintiff timely notified defendant, its insurer, and requested that defendant defend and indemnify plaintiff in the Woods' action. Defendant disclaimed and plaintiff commenced this declaratory judgment action seeking a declaration that three specified policies of insurance obligated defendant to defend and indemnify plaintiff in the Woods' action. Special Term denied defendant's motion to dismiss plaintiff's complaint for failure to state a cause of action, made before the answer was served, and this appeal ensued.

Defendant's obligation to defend is broader than its obligation to indemnify, and exists if the complaint in the Woods' action " 'alleges facts and circumstances, some of which would, if proved, fall within the risk covered by the policy' * * * (Sturges Mfg. Co. v. Utica Mut. Ins. Co., 37 N.Y.2d 69, 72, 371 N.Y.S.2d 444, 332 N.E.2d 319). Put another way, defendant has no obligation to defend only if it can be concluded as a matter of law that there is no possible factual or legal basis on which defendant might eventually be held to be obligated to indemnify plaintiff under any provision of the insurance policies (Spoor-Lasher Co. v. Aetna Cas. & Sur. Co., 39 N.Y.2d 875, 386 N.Y.S.2d 221, 352 N.E.2d 139).

The thrust of defendant's argument with respect to all three policies at issue here is that the allegations of the Woods' complaint cannot be construed as alleging that the damages sought resulted from an accident within the meaning of the policies. ^* The general liability policy covers "bodily injury" caused by an "occurrence", while the umbrella policy covers "personal injury" caused by an "occurrence". "Occurrence" is defined in each policy as "an accident, including continuous or repeated exposure to conditions, which results in bodily injury or property damage neither expected or intended from the standpoint of the insured". The workers' compensation policy covers "bodily injury by accident * * * sustained * * * by any employee of the insured arising out of and in the course of his employment by the insured * * *".

The multifaceted term "accident" is not given a narrow technical definition by the law. It is construed, rather, in accordance with its understanding by the average man * * * who, of course, relates it to the factual context in which it is used * * *. "is customary to look at the causalty from the point of view of the insured, to see whether or not, from his point of view, it was unexpected, unusual and unforeseen" (Miller v. Continental Ins. Co., 40 N.Y.2d 675, 676, 677, 389 N.Y.S.2d 565, 358 N.E.2d 258).

In order to recover in their action under section 297 (subd. 9) of the Executive Law, the Woods must first prove that plaintiff discharged Kathleen Wood because of her disability (Executive Law, § 296, subd. 1, par. If, in fact, plaintiff discharged Kathleen Wood from her employment because of her disability, it cannot be said that the mental and emotional injuries alleged by the Woods as flowing directly from plaintiff's intentional discriminatory practice were unexpected and unforeseen by plaintiff, the insured. While "it is not legally impossible to...