Fieldstone Prop. Owners Ass’n, Inc. v. Hermitage Ins. Co. (N.Y. February 24, 2011)

CGL Policy Primary Over D&O Policy Per “Other Insurance” Clauses

Two insurers—one a CGL and one a D&O—disagreed about which one was obligated to defend and indemnify their mutual insured in two underlying lawsuits wherein the plaintiffs asserted claims for injurious falsehood. The insurers agreed that both policies covered the injurious falsehood claims but disagreed as to the priority of coverage. The Court of Appeals held that the CGL insurer was obligated to defend the insured until such time as the injurious falsehood claim was dismissed, even though none of the other claims were covered by the policy. The court also held that pursuant to the policies’ “other insurance” clauses, the CGL insurer was obligated to provide primary coverage without contribution from the D&O insurer.