State Farm Mut. Auto. Ins. Co. v. Westlake

• Decision Date: 24 May 1973
• Parties: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff, v. James WESTLAKE et al., Defendants.
• Court: New York Supreme Court

Page 67

344 N.Y.S.2d 67

74 Misc.2d 604

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff, v. James WESTLAKE et al., Defendants.

Supreme Court, Special Term, Nassau County, Part III.

May 24, 1973.

Curtis, Hart & Zaklukiewicz, Merrick, for plaintiff.

Siben & Siben, Bay Shore, for defendant, James Westlake.

John W. Fuhrman, Smithtown, for defendants, Robert Christ and Louise Christ.

MEMORANDUM

JOSEPH LIFF, Justice.

The question presented for determination on an agreed statement of facts is as to the coverage of a policy of automobile liability insurance. The policy was issued by the plaintiff to the defendant, Westlake.

Mrs. Westlake was a passenger in the vehicle which her husband was operating when it came into contact with a vehicle owned by the defendant, Robert Christ, which at the time was being operated by his wife, Louise Christ. The Westlakes brought an action in the Supreme Court, Suffolk County, to recover damages for the injuries alleged to have been sustained by them. Instead of asserting their claim for relief against Mr. Westlake in that action in the form of a counterclaim, which would have been the proper procedure (CPLR 3019 (a); Moreno v. Galdorisi, 39 A.D.2d 450, 452, 336 N.Y.S.2d 646, 647), they commenced a third party action. The difference in form may be disregarded.

Of course, this is another one of the many questions which have arisen out of Dole v. Dow Chemical Co., 30 N.Y.2d 143, 331 N.Y.S.2d 382, 282 N.E.2d 288. Moreno v. Galdorisi, supra, is authority for the claim of the Christs against Westlake.

Unless it contains a provision to the contrary, a policy does not cover the assured against any liability because of the death of, or injuries to, a spouse (Insurance Law § 167 (3)). This provision was originally incorporated in Section 109 of the Insurance Law (enacted 1937) when the Legislature also adopted Section 57 of the Domestic Relations Law (now General Obligations Law § 3--313) which terminated inter-spousal immunity. The legislative purpose 'was to protect insurance carriers from collusive actions between spouses arising out of automobile accidents' (New Amsterdam Cas. Co. v. Stecker, 3 N.Y.2d 1, 7, 163 N.Y.S.2d 626, 631, 143 N.E.2d 357, 360) while creating a right of action which had not previously existed (Fuchs v. London & Lancashire Indemnity Co., 258 App.Div. 603, 605, 17 N.Y.S.2d 338, 339).

It has been held (Aetna Cas. & Sur. Co. v. DeLosh, 73 Misc.2d 275, 341 N.Y.S.2d 465) that Section 167(3) has no application in a situation such as that with which we are concerned. We agree with the court's finding that there is little likelihood of fraud present in the action between the Westlakes and the Christs especially so because Mrs Westlake would have to be successful in her action against the Christs before the latter would have any right of indemnification against Mr. Westlake (see the discussion of this matter by Dean Joseph M. McLaughlin in his article on New York Trial Practice in the New York Law Journal issue of December 8, 1972, p. 5, col. 1--2; Dole and Insurance Law § 167 (3) by Robert J. Smith, Journal of the Insurance, Negligence and Compensation Law Section--Fall--1972, New York State Bar Association). However, it would seem that you cannot reexamine the legislative intent in enacting Section 167(3) when it did, in the light of Dole v. Dow which is a recent innovation. We have discovered only one other decision on this topic. In Smith v. Employer's Fire Ins. Co., 72 Misc.2d 524, 340 N.Y.S.2d 12, the Court held that Section 167(3) of the Insurance Law absolves the insurance company from defending where its insured's liability is incurred by reason of the injuries to the spouse. We agree with that conclusion. However, another cogent reason for holding that Section 167(3) should not be circumvented so as to impose the obligation on insurance companies to defend and indemnify their insured in these situations is that a decision to the contrary will in effect be extending the contract between the spouse and the carrier to include coverage for situations...