Summary
In Ramos v. National Casualty Company, 227 AD2d 250 (1st Dept. 1996), it was held that an "insurer with a duty to defend which refuses to do so is bound by the court's determination of the underlying action and cannot thereafter collaterally attack the judgment or raise defenses with respect to the merits".
Summary of this case from Martin v. Safeco Ins. Co. of Am.Opinion
May 16, 1996
Appeal from the Supreme Court, Bronx County (Jerry Crispino, J.).
The duty of an insurer to defend is broader than its duty to indemnify ( Ruder Finn v. Seaboard Sur. Co., 52 N.Y.2d 663, 669). Where, as here, the claim, as pleaded within the "four corners of the complaint" in the underlying action, falls within the scope of the insurance policy, the insurer must provide a defense ( Continental Cas. Co. v. Rapid-American Corp., 80 N.Y.2d 640, 648), unless a court directs otherwise ( see, Colon v. Aetna Life Cas. Ins. Co., 66 N.Y.2d 6). An insurer with a duty to defend which refuses to do so is bound by the court's determination of the underlying action and cannot thereafter collaterally attack the judgment or raise defenses with respect to its merits ( Matychak v. Security Mut. Ins. Co., 181 A.D.2d 957, 958-959, lv denied 80 N.Y.2d 758). Defendant insurer's refusal to defend herein caused it to be bound by the finding in the underlying action that the injured party was not an employee of its insured, so that defendant could not now raise the issue of employment status. Further, as the claim in the underlying personal injury action, as pleaded, fell within the scope of defendant's policy, defendant's disclaimer was plainly improper. We note that, even if the employment claim could now be raised, defendant's proof, based on unsworn statements and information obtained by its investigators, was not in admissible form and was therefore insufficient to defeat plaintiffs' motion for summary judgment ( Zuckerman v. City of New York, 49 N.Y.2d 557, 562).
Concur — Rosenberger, J.P., Wallach, Kupferman and Williams, JJ.