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What’s in a Named Insured? (NY)

January 21, 2022

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<p style="text-align: justify;">In a terse but interesting decision, the New York Supreme Court, Appellate Division, First Department, reversed the Supreme Court’s grant of Mt. Hawley Insurance Company’s motion to dismiss in <em><a href="https://www.wcmlaw.com/wp-content/uploads/2022/01/CastlePoint-Natl.-Ins.-Co.-v.-Mt.-Hawley-Ins.-Co..pdf">CastlePoint Natl. Ins. Co. v. Mt. Hawley Ins. Co.</a>,</em> based on the cross liability exclusion of Mt. Hawley’s policies.  The sole issue on appeal was whether Mt. Hawley correctly disclaimed coverage on a cross liability exclusion. Plaintiff Castlepoint alleged that Mt. Hawley was required to reimburse it for amounts paid that it believed Mt. Hawley was obligated to pay.</p>
<p style="text-align: justify;">The Appellate Division stated in no uncertain terms that the Supreme Court’s interpretation and subsequent decision which held Trumball Equities, LLC was a named insured was plain wrong.  The provision at issue was the policy’s coverage exclusion for “any action, claim, or ‘suit’ brought by one Named Insured against any other Named Insured covered under this policy.”  The Appellate Division noted that although Trumball was indeed a named insured on a different premises, it was merely an additional insured on the premises where the loss occurred, and therefore, the cross-liability exclusion did not apply. In other words, the appellate court distinguished the different projects in which Trumball was a named insured as opposed to the instant project, in which it was merely an additional insured.</p>
<p style="text-align: justify;">This decision certainly makes the definition of “Named Insured” a lot more interesting, and Wade Clark Mulcahy LLP will be watching to see if this prompts an action in rescission.</p>
<p style="text-align: justify;">Thanks to Richard Dunne for his contribution to this article.  If you have any questions, please contact <a href="mailto:mcare@wcmlaw.com">Matthew Care.</a></p>

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