Paganov.Allstate Insurance Company

Appellate Division of the Supreme Court of New York, Second DepartmentMar 15, 2004
5 A.D.3d 576 (N.Y. App. Div. 2004)
5 A.D.3d 576773 N.Y.S.2d 307

2003-02879.

Decided March 15, 2004.

In an action for a judgment declaring that the defendant is obligated to defend and indemnify the plaintiffs in an underlying action entitled Schlaefer v. Pagano, pending in the Supreme Court, Nassau County, under Index No. 14482/02, the plaintiffs appeal from an order of the same court (O'Connell, J.), dated March 11, 2003, which denied their motion for summary judgment and granted the defendant's cross motion for summary judgment.

Shayne, Dachs, Stanisci, Corker Sauer, Mineola, N.Y. (Norman H. Dachs and Jonathan A. Dachs of counsel), for appellants.

Schondebare Brown, LLP, Ronkonkoma, N.Y. (Dennis Brown of counsel), for respondent.

Before: NANCY E. SMITH, J.P., GLORIA GOLDSTEIN, WILLIAM F. MASTRO, REINALDO E. RIVERA, JJ.


DECISION ORDER

ORDERED that the order is affirmed, with costs, and the matter is remitted to the Supreme Court, Nassau County, for the entry of a judgment declaring that the defendant Allstate Insurance Company is not obligated to defend and indemnify the plaintiffs in the underlying action entitled Schlaefer v. Pagano, pending in the Supreme Court, Nassau County, under Index No. 14482/02.

An insurance carrier must provide a defense to its insured "whenever the allegations in a complaint, liberally construed, suggest a reasonable possibility of coverage, or when the insurer has actual knowledge of facts establishing such a reasonable possibility" ( City of New York v. Insurance Corp. of N.Y., 305 A.D.2d 443; see Frontier Insulation Contrs. v. Merchants Mut. Ins. Co., 91 N.Y.2d 169, 175). To be relieved of its duty to defend, an insurer must establish, as a matter of law, that there is "no possible factual or legal basis upon which it might eventually be obligated to indemnify its insured," or must prove that "the allegations fall wholly within a policy exclusion" ( City of New York v. Insurance Corp. of N.Y., supra at 444; see Frontier Insulation Contrs. v. Merchants Mut. Ins. Co., supra). In determining whether coverage exists, the court must assume that what is alleged in the complaint actually happened ( Allstate Ins. Co. v. Mugavero, 79 N.Y.2d 153, 159; Altamore v. Aetna Cas. Sur. Co., 238 A.D.2d 455, 456; Monter v. CNA Ins. Cos., 202 A.D.2d 405, 405-406).

The homeowner's and personal umbrella policies issued by the defendant to the plaintiffs excluded coverage for bodily injury "intended by, or which may reasonably be expected to result from the intentional or criminal acts or omissions of, an[y] insured person." Since the acts alleged in the underlying action sounding in assault and intentional infliction of emotional distress were intentional acts, they were not covered by the policy, and the defendant was not obligated to defend or indemnify the plaintiffs ( see Harmann v. Allstate Ins. Co., 260 A.D.2d 544, 545; Altamore v. Aetna Cas. Sur. Co., supra; Tranchina v. Government Empls. Ins. Co., 235 A.D.2d 471; Utica Fire Ins. Co. of Oneida County, N.Y. v. Shelton, 226 A.D.2d 705).

We note that since this is a declaratory judgment action, the Supreme Court should have directed the entry of a judgment declaring that the defendant is not obligated to defend and indemnity the plaintiffs in the underlying action entitled Schlaefer v. Pagano, pending in the Supreme Court, Nassau County, under Index No. 14482/02 ( see Lanza v. Wagner, 11 N.Y.2d 317, 334, appeal dismissed 371 U.S. 74, cert denied 371 U.S. 901).

SMITH, J.P., GOLDSTEIN, MASTRO and RIVERA, JJ., concur.