U.S. Fidelity and Guaranty Co. v. Copfer

• Decision Date: 29 November 1979
• Citation: U.S. Fidelity and Guaranty Co. v. Copfer, 424 N.Y.S.2d 356, 48 N.Y.2d 871, 400 N.E.2d 298 (N.Y. 1979)
• Parties: , 400 N.E.2d 298 UNITED STATES FIDELITY AND GUARANTY COMPANY, Respondent, v. William G. COPFER et al., Individually and as Parents and Natural Guardians of Thomas Copfer et al., Defendants, and Thomas Copfer, Appellant.
• Court: New York Court of Appeals Court of Appeals

Page 356

424 N.Y.S.2d 356

48 N.Y.2d 871, 400 N.E.2d 298

UNITED STATES FIDELITY AND GUARANTY COMPANY, Respondent, v.William G. COPFER et al., Individually and as Parents and NaturalGuardians of Thomas Copfer et al., Defendants and Thomas Copfer, Appellant.

Court of Appeals of New York.

Nov. 29, 1979.

We agree that the insurer breached its contractual duty to defend and indemnify the insured and thus may be held liable for the expenses the insured incurred in providing for his own defense (International Paper Co. v. Continental Cas. Co., 35 N.Y.2d 322, 361 N.Y.S.2d 873, 320 N.E.2d 619).Additionally, the insurer may be required to reimburse the insured, up to the coverage limits in the insurance policy, for any judgment the insured is in turn required to pay as a result of the negligence action against him.The insured's claim for additional damages resulting from the insurer's alleged "bad faith" must be rejected, however, since there was no showing whatsoever that the insured lost an actual opportunity to settle the negligence claim against him within the coverage limits of his policy by reason of the insurer's purported "bad faith"(seeSt. Paul Fire & Mar. Ins. Co. v. United States Fid. & Guar. Co., 43 N.Y.2d 977, 404 N.Y.S.2d 552, 375 N.E.2d 733;Kulak v. Nationwide Mut. Ins. Co., 40 N.Y.2d 140, 386 N.Y.S.2d 87, 351 N.E.2d 735;cf.Decker v. Amalgamated Mut. Cas. Ins. Co., 35 N.Y.2d 950, 365 N.Y.S.2d 172, 324 N.E.2d 552).The insured's speculations that a satisfactory settlement might have ensued had the insurer sought out the injured party and attempted to negotiate on behalf of its insured are simply not sufficient to support a claim against the insurer for what are essentially excess liability damages (seeGordon v. Nationwide Mut. Ins. Co., 30 N.Y.2d 427, 334 N.Y.S.2d 601, 285 N.E.2d 849).Accordingly, we hold that the Appellate Division acted properly in granting summary judgment to the insurer on this claim.

MEYER, Judge (dissenting).

Respectfully, I dissent.The carrier received from its insured a complaint which declared in negligence only.It was, therefore, obligated to defend, and since the trial of the action had to result either in a verdict for its insured or a finding that the insured had been guilty of negligence, it was clear from the face of the complaint that its coverage disclaimer was one that "no reasonable carrier would * * * be expected to assert"(Sukup v. State of New York, 19 N.Y.2d 519, 522, 281 N.Y.S.2d 28, 31,...