37 A.D.2d 535 | N.Y. App. Div. | 1971
Judgment, Supreme Court, New York County, entered on July 8, 1970, affirmed. Respondent shall recover of appellant $50 costs and disbursements of this appeal. This action for a declaratory judgment by an insured against its insurer was tried on an agreed statement of facts. The policy, issued November 30, 1961, was issued to plaintiff, insuring it for liability in connection with the premises at 1423 Redfem Avenue, Queens. On January 22, 1963, plaintiff sold the property and at the same time canceled the policy. On July 2, 1963, a fire occurred in the premises and persons injured therein brought suit against plaintiff and the then owner of the premises. The complaint in that action alleged negligence by plaintiff in the maintenance of the premises prior to the transfer, which negligence it is alleged was a contributing cause of the fire. This action seeks a declaration that under the policy defendant is obligated to defend the action on behalf of plaintiff and to indemnify plaintiff against any recovery within the policy limits. Two clauses in the policy,' both appearing in the “ Definition of Hazards ”, bear on the question. They are: “ VI. Alienated Premises. Such insurance as is afforded by this policy under division 1 of the Definition of Hazards applies to premises alienated by the named Insured, if the accident occurs after the named insured has relinquished possession thereof to others. * * * VII. Policy Period, Territory. This policy applies only to accidents which occur during the policy period within the United States of America, its territories or possessions, or Canada.” It is defendant’s contention that clause VII limits VI so that the coverage after alienation is restricted to the period that the policy is in effect by the continued payment of premiums; and that the purpose of the clause is to give the policyholder an insurable interest in the premises. This is advanced to explain what otherwise would be directly contrary provisions. For two reasons we cannot accept this interpretation. Defendant concedes that the medium of interpretation is what the policy would mean to the ordinary policyholder and that any ambiguity is to he resolved against the author of the policy, namely, the insurer. On this standard the specific provision in regard to alienated premises would appear to he controlling and to excuse the policyholder from the extraordinary course of paying premiums after he parted with the subject property. The second reason is that defendant’s claimed explanation does not explain. On a liability policy, as distinct from a policy insuring the premises themselves, no insurable interest in the. premises is required (Berry v. American Cent. Ins. Co., 132 N. Y. 49, 56). Concur — Markewich, J. P., Kupferman and Steuer, JJ.; Tilzer and Eager, JJ., dissent in part in the following memorandum by Eager, J.: The judgment entered in this declaratory judgment action should be modified to delete any declaration having the effect of now determining that the defendant, Aetna Casualty and Surety Company, is obligated under its insurance policy to indemnify the plaintiff for and to pay the recoveries, if any be had against it, in the tort actions brought against plaintiff. All questions- as to coverage, except that relating to the obligation to defend, should be reserved for determination following the final disposition of the tort actions. The action was submitted for determination upon the pleadings and on an agreed statement of facts. It is agreed that the plaintiff acquired title to a certain building and premises on November 30, 1961 and continued to own the same from said date until January 22, 1963. On November 30, 1961, the defendant Aetna issued to plaintiff an “ Owners’, Landlords’ and Tenants’ Liability Policy” covering the premises. The policy was voluntarily canceled by the plaintiff on January 22, 1963 when plaintiff conveyed the premises. About five and one-half months after the cancellation of the policy, a fire occurred at the premises