167 Misc. 608 | N.Y. Sup. Ct. | 1938
This is a motion by both defendants to dismiss the complaint for insufficiency.
Plaintiff recovered a judgment in the sum of $25,000 against Suburban Road Corporation for negligence resulting in the death of the intestate. The judgment debtor was covered by a policy with the Consolidated Indemnity and Insurance Company now in the hands of the Superintendent of Insurance as liquidator. Under a contract of reinsurance between the insolvent company made while it was solvent, and General Reinsurance Corporation, the latter assumed liability for losses above a basic $5,000. This reinsurance policy was not made specifically to cover this situation but was a blanket policy to cover future situations. The present reinsurance contract was made prior to the negligence which resulted in plaintiff’s cause of action. As the Consolidated Indemnity Company is insolvent, plaintiff seeks to recover $20,000 from the General Reinsurance Corporation, being the coverage under the reinsurance contract. Plaintiff also seeks a declaratory judgment to the effect that the Superintendent of Insurance is not entitled to receive any portion of the benefits under the reinsurance contract, and that the payment should be made direct to the plaintiff.
It is well settled that there is no privity of contract between the plaintiff and either one of the defendants. To obviate the hardships which arose by reason of that fact and the inability of
I cannot entirely accept the statement of the plaintiff that the Allemannia rule has been reversed by the later case or that the reinsurer would virtually go scot-free as the result of that decision. A reading of the policy in the instant case and the rights given to the insurer represented as here by the Superintendent of Insurance to have recourse on losses in excess of $2,500 without prior payment, contradict any such gloomy foreboding. It is unfortunate that the salutary purpose of the law was not extended so as to include under the benefits of section 109 a right of recourse against the reinsurer as well as the insurer, but I must accept the statute as it reads.
The motion to dismiss the complaint is granted, without costs. Settle order.