Newsletters

Barry Inn Realty, Inc. v. Endurance American Specialty Insurance Company and M.G.I. Brokerage Inc.

In this first-party property insurance matter, Plaintiff sought coverage after a fire damaged its building in the Bronx, New York. MCWG moved for summary judgment on behalf of MCWG client Endurance American Specialty Insurance Company (“Endurance”) on the ground that Plaintiff made a material misrepresentation in its application for insurance and Endurance, therefore, was entitled to rescind the policy from the date of inception. Specifically, Plaintiff failed to disclose a previous loss at the premises within the past three years, despite being asked to provide its loss history in the application for insurance.

Ruling in Endurance’s favor, the Bronx Supreme Court held that Endurance satisfied its initial summary judgment burden by tendering evidence in admissible form that Plaintiff made a material misrepresentation in its insurance application as Plaintiff had admitted in its responses to Endurance’s Notice to Admit that it had a prior loss. Endurance also submitted an affidavit from its underwriter, along with the company’s Underwriting Guidelines, which demonstrated that Endurance would not have issued the insurance policy to Plaintiff had it been told about the prior loss.

The Court further held that Plaintiff failed to raise a triable issue of fact in its opposition to Endurance’s motion. Plaintiff did not dispute that the information in the application was incorrect and its contention that the misrepresentations were attributable to its insurance broker was unavailing. Moreover, the Court rejected Plaintiff’s argument that the motion was premature in that discovery was incomplete and no depositions had yet been taken; rather the Court sided with Endurance because it demonstrated that the misrepresentations were material based on the sworn affidavit of the underwriter and the underwriting guidelines and Plaintiff failed to establish how further questioning of the underwriter would “reveal evidence at variance with Endurance’s proof.”

For inquiries about this case, please contact partner Mark Katz or associate Maegan McAdam.