Vacancy Exclusion

Hayden Asset VIII LLC v. Public Service Mutual, case number 161751/2014 (New York Supreme Court)

Mound Cotton’s client recently received a favorable ruling from a New York state judge in a case involving water damage claims made by the owner of a Connecticut restaurant property. Judge Sabrina Kraus cited the vacancy exclusion clause in the insurance policy, which prevented coverage for damage caused by frozen pipes in the vacant property, leading to the dismissal of the claims.

The insurers argued that the plaintiff’s sought-after coverage was excluded by the provision regarding damage caused by frozen domestic water lines due to the owner’s failure to adequately maintain the plumbing system or take necessary precautions to prevent damage. They also argued that the Vacancy Provision applied in this case, as the building had been vacant and the heating inside the property did not protect the system from freezing.

Judge Kraus agreed with the insurers, stating that

“It is undisputed that the premises were unoccupied, and that the damages were caused by water that was discharged because the pipes froze.”

Partner Kevin F. Buckley commented on the ruling, saying,

“The client is pleased that, given the compelling facts in this case, the court applied the insurance policy properly.”

Partners Kevin F. Buckley and Daniel M. O’Connell represent Public Service Mutual Insurance Co.

This decision was reported in Law360 (subscription required).

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