The First Department determined, in this declaratory judgment action, the insurer has the duty to defend the city in this slip and fall case. The fact that information which is outside the four corners of the complaint may indicate the insurer does not have the duty to defend must be raised in a summary judgment motion or at trial:
Under the circumstances presented, the City’s cross motion is granted to the extent of declaring that plaintiff is obligated to defend it in the underlying litigation. The duty of an insurer to provide a defense for its insured is “exceedingly broad,” arising “whenever the allegations of the complaint suggest. . . a reasonable possibility of coverage” … . Accordingly, “a liability insurer has a duty to defend its insured in a pending lawsuit if the pleadings allege a covered occurrence,” even if “facts outside the four corners of those pleadings indicate that the claim may be meritless or not covered” … . Thus, an insurer may be contractually bound to defend “even though it may not ultimately be bound to pay, either because its insured is not factually or legally liable or because the occurrence is later proven to be outside the policy’s coverage” … .
Here, the four corners of the complaint in the underlying action place the allegations squarely within the responsibilities of plaintiff’s insured, triggering the duty to defend. Plaintiff’s primary argument, that the accident was not within its insured’s area of responsibility, is properly made to Supreme Court in a motion for summary judgment dismissing Bari’s complaint or at trial and cannot be resolved by this Court on a motion seeking declaratory relief… . Axis Surplus Ins. Co. v GTJ Co., Inc., 2016 NY Slip Op 04106, 1st Dept 5-26-16
INSURANCE LAW (INSURER’S DUTY TO DEFEND MUST BE DETERMINED SOLELY UPON THE INFORMATION WITHIN THE COMPLAINT, MATTERS OUTSIDE THE COMPLAINT MUST BE RAISED IN A SUMMARY JUDGMENT MOTION OR AT TRIAL)/NEGLIGENCE (INSURER’S DUTY TO DEFEND MUST BE DETERMINED SOLELY UPON THE INFORMATION WITHIN THE COMPLAINT, MATTERS OUTSIDE THE COMPLAINT MUST BE RAISED IN A SUMMARY JUDGMENT MOTION OR AT TRIAL)