Burlington Ins. Co. v. N.Y. Constr. & Renovation, Inc.

210 A.D.3d 576

179 N.Y.S.3d 49

The BURLINGTON INSURANCE COMPANY, Plaintiff–Appellant,

v.NEW YORK CONSTRUCTION & RENOVATION, INC., et al., Defendants.

Century Surety Company, Defendant-Respondent.

16739

Index No. 650890/21

Case No. 2021–03170

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

Entered November 29, 2022

Adrian & Associates, LLC, New York (Anna Karin F. Manalaysay of counsel), for appellant.

Traub Lieberman Straus & Shrewsberry LLP, Hawthorne (Craig L. Rokuson of counsel), for respondent.

Webber, J.P., Friedman, Kennedy, Mendez, Shulman, JJ.

Order, Supreme Court, New York County (Laurence L. Love, J), entered July 27, 2021, which granted defendant Century Surety Company's motion to dismiss the complaint as against it, unanimously reversed, on the law, without costs, the motion denied, and the complaint reinstated as against Century.

Plaintiff Burlington Insurance Company commenced this declaratory judgment action to determine insurance coverage available in two underlying actions involving damage sustained by property owned by defendant DAJ Realty, LLC as a result of construction work performed by defendant New York Construction & Renovation Inc. (NYC & R) during an unspecified period. Burlington provided primary coverage to NYC & R for the periods February 2013 to 2014 and February 2014 to 2015; Century provided an excess policy that was to be triggered by exhaustion of "controlling underlying insurance," defined in the Century policy as the 2013–2014 Burlington policy.

Insofar as relevant to this appeal, Burlington seeks a declaration that it has no duty to defend or indemnify NYC & R under its two policies because the Century policy will be triggered before one or more of the Burlington Policies are triggered. For its part, Century argues that its policy is triggered only after all other insurance is exhausted, including both Burlington policies. Century also contends that coverage will be allocated on a pro rata basis among available policies, resulting in all primary policies being exhausted before Century's policy is reached.

Burlington's allegation in the complaint that the Century Policy will be triggered before one or more of the Burlington Policies are triggered is incorrect, as the Century policy is an excess policy. However, Century's contention in support of its motion that the Century policy is excess to both Burlington policies is also incorrect. The insuring agreement of the Century policy states that Century "will pay on behalf of the insured the ‘ultimate net loss’ in excess of the retained limit,’ " which in turn is defined as "the available limits of ‘controlling underlying insurance’ applicable to the claim" – that is, the 2013–2014 Burlington policy. In light of the language in Century's excess policy "tying [its] attachment only to [a] specific underlying [policy] in effect during the same policy period as the applicable excess policy, and the absence of any policy language suggesting a contrary intent," the Century...