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Dan D. Kohane, Hurwitz & Fine, P.C., Buffalo, NY, recently obtained a favorable ruling for Century Surety Company before the United States Court of Appeals for the Second Circuit. In the case, Arthur Sleszynski, an employee for Pinnacle Construction and Renovation Corporation, sued the general contractor on the project, Hayden Building Maintenance Corporation, for injuries that occurred during his employment with Pinnacle. Hayden and Endurance American Specialty Insurance sought to force Century Insurance, under a policy issued to Pinnacle as the named insured and in which Hayden was an additional insured, to defend and provide coverage for the lawsuit against Hayden. The Century policy excluded from coverage a claim for bodily injury to an employee of the "named insured" arising in the course and scope of employment.  The District Court ruled against Century but on appeal the Second Circuit found that the exclusion unambiguously excluded coverage for injuries to Slezynski.  The Second Circuit held this unambiguous exclusion was not changed by the Separation of Insureds provision, reversed the District Court and judgment was entered for Century finding no coverage.  


More Kohane Triumphs…

Dan D. Kohane, Hurwitz & Fine, P.C., Buffalo, NY, recently obtained a favorable ruling from the Appellate Division, Fourth Dept., Supreme Court of the State of New York in the case of Redeye v. Progressive Insurance Company, involving a claim for New York underinsured motorists benefits.  In the action, the Appellate Division held that the settlement from a Dram Shop Action reduces the recovery under a SUM Policy under the non-duplication clause.

Redeye brought a lawsuit to recover supplementary uninsured/underinsured motorist (SUM) benefits from defendant, his auto insurer. While a pedestrian, he was injured when a drunk driver struck a car that was propelled into him.  Redeye sued the drunk driver as well as a fire company that allegedly served the driver alcoholic beverages prior to the accident, and he received a settlement from both. Progressive denied Redeye’s claim for SUM benefits, stating that coverage was exhausted by the recovery from both the driver and the fire company, prompting him to commence this action. Redeye conceded that the SUM coverage was properly reduced by the amount he recovered from the driver's insurer. He contended, however, that it was improper to reduce the SUM coverage by the amount he received from the fire company under its general liability insurance policy. New York’s Appellate Division, Fourth Department rejected that contention.

Condition 11 (e) of the SUM endorsement under defendant's policy provided that SUM coverage "shall not duplicate . . . any amounts recovered as bodily injury damages from sources other than motor vehicle bodily injury liability insurance policies or bonds."  As the fire company's insurer's payment was for bodily injury damages, the court held that the amount of SUM benefits available to plaintiff was properly reduced by that amount.  The court also found that Condition 11 did not conflict with Condition 6 of the SUM endorsement which provided that the maximum payment under the SUM endorsement is the difference between the SUM limit and any payments received from a motor vehicle bodily injury liability policy. It does not state that the difference is "the" SUM payment that is to be given to plaintiff, but rather it states that the difference is the "maximum" payment, which the average insured would understand to mean that it could be further reduced.  The court found that Condition 6 and Condition 11, taken together, resulted in a reduction in the SUM benefits available by the total settlement received by plaintiff in his prior action.

Do you have a triumph to share? Send a brief summary and a recent photograph to Scott Salter at ssalter@starneslaw.com


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