Opinion
May 1, 1967
Appeal from an order of the Supreme Court, Sullivan County, granting the third-party defendants' motions to dismiss the third-party plaintiffs' complaints. Plaintiff seeks to recover for scaffolding damaged on May 26, 1964 when a guest house under construction at the third-party plaintiffs' resort was destroyed by fire. The third-party complaints seek to assert liability over against a liability carrier and/or four fire insurance companies for any recovery obtained by the plaintiff. Special Term in dismissing the complaints held that the fire insurance companies could not be held liable on their fire insurance contracts because while there was a clause extending coverage to builders' equipment it provided coverage only when the destroyed property was "not otherwise covered by insurance" whereas here the scaffolding was covered under the plaintiff's insurance policies and additionally because the loss had not been claimed within 12 months' limitation period provided in the contract pursuant to section 168 Ins. of the Insurance Law. With respect to the liability carrier Special Term held that the clause excluding coverage with respect to "liability assumed by the insured under any contract or agreement", precluded recovery since the damages to the scaffolding constituted a liability for which third-party plaintiff Karell was responsible to plaintiff under the contract by which the scaffolding was leased. Third-party plaintiffs urge, and we believe correctly, that the plaintiff's insurance coverage of the scaffolding did not obviate their coverage under the terms of their fire insurance policies. The exclusion of coverage for risks which are covered by "additional insurance" or "other insurance" or "double insurance" prevents recovery only if there is an identity of interest in the property covered, i.e., when one insured has multiple coverage on the same property. Here the plaintiff had a distinct and separate insurance interest from the third-party plaintiffs and thus his obtaining coverage did not necessarily eliminate the third-party plaintiffs' right of recovery under their policies (30 N.Y. Jur., Insurance, §§ 1033-1035; Suetterlein v. Northern Ins. Co., 251 N.Y. 72, 76; Smith v. Northern Ins. Co. of N Y., 232 App. Div 354, 357-358). Nor do we believe that Special Term should have summarily invoked the 12 months' time limitation in the face of factual issues of waiver and estoppel raised by the affidavit of Karell's president ( Proc v. Home Ins. Co., 17 N.Y.2d 239, 245). Similarly we cannot agree with Special Term's dismissal of the complaint against the liability carrier. The clause excluding "liability assumed by the insured under any contract or agreement" is not applicable if the contracted liability is merely that same liability for which the insured would be liable absent the contract provision (30 N.Y. Jur., Insurance, § 1177; see O'Dowd v. American Sur. Co. of N.Y., 3 N.Y.2d 347). Here the plaintiff's complaint alleges in the second cause of action liability premised on a bailment relationship, which liability cannot arise without negligence ( Reisinger v. Pullman Co., 252 App. Div. 87, affd. 277 N.Y. 679). Thus it is possible that the insured will be held responsible on the basis of liability which exists at law and without regard to the express agreement, in which event the exclusionary clause would be inoperative and coverage possible. Order reversed, on the law and the facts, with costs to abide the event. Gibson, P.J., Herlihy, Reynolds, Aulisi and Staley, Jr., JJ., concur in memorandum by Reynolds, J.